Asian stocks traded mixed Thursday as traders remained skeptical about the Trump administration’s announcement of less harsh measures on Chinese investments. Treasury yields steadied and emerging market currencies declined.
Stocks slipped in Japan and South Korea, and rose in Hong Kong, while U.S. futures pointed to gains. Chinese shares reversed earlier losses to edge higher though anxiety remains around the nation’s assets after equities lost almost $2 trillion in five months, and the yuan stayed under pressure. The dollar was little changed while the MSCI Emerging Market Currency Index fell for a fourth session, heading for its worse quarter since the three months through September 2015.
Earlier, the S&P 500 Index reversed gains to close lower after White House economic adviser Larry Kudlow said the decision not to adopt a more stringent approach on trade did not represent a softer stance on China.
US After Hours PRGS +3%, PIR -15%, PFIE -9%, BBBY -6%, CMG -4% following earnings/guidance, MSG +9% on spin-off exploration news
Nikkei +0.03% Hang Seng +0.07% CSI -0.49% Shanghai -0.36% Shenzen -0.33%
Eur$ 1.1552 CNH 6.6208 CNY 6.6169 JPY 110.27 GBP 1.3081 CHF 0.9980 RUB 63.1667 WTI$ 72.41 -0.48%
S&P +0.13% EuroStoxx -0.41% Dax -0.35% FTSE -0.19% SMI -0.41%
Macro :
- Senate Should Take Up Supreme Court Pick After Midterms: Schumer
- Lyft Doubles Valuation From 2017 to $15.1b in New Funding: WSJ
Keep an eye on :
- AGS BB : Boussard & Gavaudan Raises Ageas Short Position to 0.7% June 25
- AIR FP : Boeing Awarded $1.5b Pact For Planes In Support of Kuwait
- ATC NA : SFR, Orange Sign Deal for Fiber Rollout in Medium-Density Areas
- AMZN US : Amazon Issues Call for Startups to Deliver Its Packages
- AAL LN : Bahrain Steel Says Anglo Suspended Contract After Spills:Reuters
- AAPL US : Apple Is Said to Eye TV, Music Streaming Bundle: The Information
- AAPL US : Apple Is Said to Get Second Supplier for OLED iPhone Screens
- ARGX BB : Argenx Gets $10m From AbbVie in ARGX-115 Development Pact
- BAS GY : BASF Reaches Pact With Canada Competition Bureau, to Sell Assets
- CRI FP : Chargeurs Fashion Buys Precision Custom’s Interlinings Business
- COFA FP : Coface Sells 36% Stake in Cofacrédit To Factofrance
- DPW GY : Amazon Issues Call for Startups to Deliver Its Packages
- DTE GY : FCC Names Justice Department Lawyer to Lead T-Mobile Deal Review
- EDPR PL : EDP Renovaveis Shareholders Name Gomez-Acebo as Board Member
- ENI IM : ExxonMobil, ENI Say Marketing Underway for Mozambique LNG
- ENX FP : Euronext Says Somers Resigns as Dublin CEO; Byrne Named to Post
- FDR SM : Fluidra, Zodiac Merger Compatible With Interior EU Market
- GSC1 GY : Gesco Sees ’18/’19 Organic Sales Up Slightly, Profit Up Strongly
- GSBD US : Goldman Sachs BDC to Offer $32.5m of 4.50% Conv Notes Due 2022
- LECN SW : Exide, Leclanche Launch Lithium-Ion Batteries Joint Venture
- LOGN SW : Logitech Board Raises Dividend by ~10%, Nominates Lao
- OPHR LN : Ophir Energy Struggling And ‘Ripe for a Takeover’, GMP Says
- ORA FP : SFR, Orange Sign Deal for Fiber Rollout in Medium-Density Areas
- PRU LN : Prudential Said to File for Potential $700 Million Malaysia IPO
- PRY IM : Prysmian Board Approves Final Terms of Cap Increase
- REP SM : Spain’s Repsol Agrees to Buy Viesgo Businesses for EU750M
- RHI LN : RHI Magnesita Says No Pact on Kumas, No Certainty One Will Occur
- ALROC FP : Roctool in EU3.6 Mln Capital Increase to Fund Expansion
- SAF FP : Fluidra, Zodiac Merger Compatible With Interior EU Market
- SGO FP : Saint-Gobain Drop Overdone, Stable Cycle Ahead: Morgan Stanley
- SAN FP : Sanofi, Advent Finalize Talks for Purchase of Zentiva
- SHP LN : Takeda Shareholders Reject Proposal Opposed to Shire Deal: Kyodo --> 4502 JT +1.67%
- SW FP : Sodexo Enlarges Executive Committee
- SWEDA SS : Swedbank to Hire 500 Digital Specialists Before End-2018: DI
- TSLA US : Panasonic Flags Battery Shortage as Model 3 Output Picks Up:Rtrs
- TKA GY : Thyssenkrupp Unit Sees $220 Million Hit Without Steel Safeguard
- UBI FP : Ubisoft Holders Voted to Allow Free Shrs Programs for Employees
- VWS DC : Maersk Supply Service, Vestas Form Partnership, Borsen Says
- ZAG AV : Zumtobel Full Year Revenue Meets Estimates
>>> Up
* Infineon Upgraded to Buy at DZ Bank; PT 26.40 Euros
* KAZ Minerals Upgraded to Outperform at BMO; PT 10.50 Pounds
* Saint-Gobain Raised to Overweight at Morgan Stanley; PT 47 Euros
>>> Down
* Suez Downgraded to Hold at Berenberg
* Summit Therapeutics ADRs Downgraded to Perform at Oppenheimer
* Summit Therapeutics ADRs Downgraded to Hold at SunTrust; PT $4
>>> Initiation
* Cellectis ADRs Rated New Buy at JonesTrading; PT $55
* Celyad ADRs Rated New Buy at JonesTrading; PT $60
* Team17 Group Rated New Buy at Berenberg; PT 2.90 Pounds
>>> Call
* *SUMMIT THERAPEUTICS PT CUT TO $5 FROM $33 AT BTIG
Monaco’s building boom spreads on to land reclaimed from the sea
Last year saw the largest number of new homes ever built in the tiny city-state
In a state with one of the world’s highest concentrations of ultra-high net worth individuals, talk of a housing crisis may stick in the throat. Nonetheless, Monaco, the city-state on France’s Mediterranean coast a little more than half the size of New York’s Central Park, is in the midst of one.
Around 20 per cent of Monaco’s 37,550 population (known as Monégasques) are locally born natives. With roughly one in 50 Monaco residents worth more than $30m, according to Wealth X, there are few remotely affordable homes for the rest to pick from. Average prime sale prices in the last year were roughly €41,300 per square metre, according to Savills — nearly three times the average price for New York.
“The property that exists is not suitable for young Monégasques. They can’t afford to rent and they certainly can’t afford to buy,” says Nancy Heslin, until last month editor-in-chief of Monaco Life, a local English news website. The longstanding problem has become more acute in recent years, as the supply of available land has all but disappeared, she says. “Supplying affordable housing has become the main priority of the new governing council elected in February”.
Last year saw the largest number of new homes ever built in Monaco in a single year, according to Savills. The latest — and arguably most ambitious — housebuilding initiative is Le Portier, due for completion in 2025. A group of private developers, overseen by the municipal government, is working on a €2.1bn project to reclaim 15 acres of land from the Mediterranean in the easternmost ward of Larvotto, a minute’s walk from Monte Carlo.
Monaco’s director of public records estimated in January that the homes — which will house 1,000 residents — would net the developers more than €3.5bn, suggesting that few of the homes will be reserved for local workers. Environmentalists say the work will disrupt the bay’s fragile biodiversity.
Perhaps the most vocal protests are coming from the minted residents of Avenue Princesse Grace. Much of the seafront boulevard — claimed by local agents to be the world’s priciest street — is overlooking the new construction site. As well as the noise and an unsightly dredger ship preparing the seabed, there is the small question of what will happen to those splendid Mediterranean views for which many existing owners have paid tens of millions of euros. Irene Luke, a 25-year resident of Monaco who runs Savills’ office there, estimates that sale prices in the area have dropped by 10 per cent since the construction began. Savills is selling a four-bedroom home with sea views for €35m. Given the location, it might be worth a haggle.
Price falls of 10 per cent price are rare for Monaco. The market worked as a safe haven in the aftermath of the financial crisis when global ultra-high net worth individuals saw it as a handy store of value, says Luke. In 2017, with the richest buyers increasingly snubbing the top-end markets of London and New York, the mix of buyer demand and scarce supply helped average Monaco prices to a 6 per cent gain in 2017, according to Savills.
Those fleeing from Monaco’s central building sites are increasingly considering the areas of La Condamine and Fontvieille. Whether any neighbourhood in Monaco — where the average house sale last year fetched €4.5m — qualifies as emerging is questionable, but with building concentrated in the traditional glitzier areas, these two spots provide relatively good value and an escape from the worst of the construction blues, says Luke.
In a city-state where listed buildings are rare, La Condamine’s narrow streets include a number of older buildings as well as good views — at least for now — of Monaco’s port. Fontvieille, which historically housed Monaco’s industrial base, is also finding a place on estate agent tours, with a good range of shops and restaurants. Bargain hunters might favour the one-bedroom apartment in Avenue De Grande Bretagne, for sale with Sotheby’s International Realty for €2.69m.
Noise nuisance and the risk of obscured views are not all that Monaco’s most wealthy are grappling with. By the end of the year, a new register disclosing the true beneficiaries of companies that own Monaco property will remove confidentiality, according to Remi Delforge, a lawyer from the firm DL Corporate & Regulatory in Monaco. The major tax break for people who owned property in this way disappeared in 2011, when the rule exempting sales of property owned by foreign entities from sales tax was withdrawn. “Such transactions can now attract up to 9 per cent,” says Delforge.
Residents are also having to work harder to prove they deserve Monaco’s beneficial resident tax status — which includes, in most cases, zero tax on income and on capital gains accrued abroad. According to Delforge, anyone applying for or renewing their visa is facing more stringent checks to utilities and local expenditure — to check that they actually live in Monaco — following a high-profile case where it was alleged that overseas residents had been bribing local officials for residency papers.
For some long-term residents the challenges of Monaco life have become too much. A combination of the construction nuisance, the perception of increased crime and a growth in the number of day-trippers from France is dulling the allure, says Heslin. “It’s a funny time. In the last six to eight months I’ve spoken to a number of residents who are leaving, saying the place is losing the glamour, exclusivity and community that they came here for.”
Buying guide
Stamp duty on individuals buying homes is 6 per cent; commission rates — 5 per cent from the seller and 3 per cent from the buyer, plus VAT — are negotiable
The average price of a home sold in Monaco in 2017 was €4.5m
Flights connect Monaco to New York in eight hours and London in two hours
What you can buy for . . .
€1m A 200 sq ft studio in La Condamine
€5m A two-bedroom apartment in a 1970s development with a balcony in Larvotto
€10m A three-bedroom apartment in Golden Square with a good view
Brussels steps up emergency planning for no-deal Brexit
Measures proposed on keeping Channel tunnel open and sustaining financial services
The EU is quietly stepping up work on emergency plans to cope with the first days of a hard Brexit, including transitional measures to mitigate damage should the UK crash out of the bloc without an exit deal.
Dubbed “the parachute” by some officials in Brussels, the provisions would in effect stagger the most severe effects of Britain’s March 2019 departure by using special arrangements for transport, financial services and customs.
“Hard Brexit would be like a bomb that hits you,” said one senior European government official overseeing Brexit contingency planning. “When the pressure is so high everything becomes fluid. Once hard Brexit becomes a reality you have to do something.”
At a summit on Friday EU leaders will note the slow progress in talks and urge authorities to accelerate contingency plans for a no-deal Brexit. But so far in Brussels these have related to “preparedness”: the drive to raise private sector awareness of legal consequences and address post-Brexit anomalies in EU rules regarding the UK.
The European Commission and member states have been less open about work on specific plans to cover the first days, weeks and months after Brexit, which would permit essential cross-border activity to continue for a limited period. Officials are also considering scenarios in which the formal UK exit date could be extended by a few months to buy time for preparations.
Any unilateral EU provisions would be tailored to the bloc’s interests and would remain in force only until the EU develops the infrastructure to enforce rules for a no-deal Brexit that could last for years.
“The commission is working on basic, bare-bones arrangements, the patches to avoid absolute chaos,” said another senior EU diplomat. “But they have been very coy about it, even with us.”
All EU level work is being co-ordinated by a dedicated team reporting to Martin Selmayr, the commission’s secretary-general.
The unilateral or “autonomous” measures under the EU’s consideration include grandfathering — or maintaining — regulatory permissions, such as safety certificates for airlines and ensuring the enforceability of financial contracts signed under UK law.
Other arrangements could for a short period keep open the Channel tunnel, a main conduit for freight. One approach could be to apply tariffs in aggregate — based on estimates of the volume of trade on the route — rather than on individual items.
EU diplomats differ on whether the arrangement should last for hours, weeks or months.
Provisions would be made for basic levels of airline service to and from UK airports, but without full EU flying rights. “You’re going to have to think about the plane that takes off at 11pm in London on the eve of the cut-off date and lands after midnight in Paris,” said one senior French official. “Will it be allowed to land?”
Separately, some of Britain’s closest trading partners are exploring which bilateral arrangements may be required. These include negotiating with the UK over railway operations and road transport, including operating licences for trucks.
Brussels has been guarded on revealing such contingency work, for both political and practical reasons.
Some officials see disclosure of the preparations as a powerful negotiating weapon that would destabilise Theresa May, the UK prime minister, and so must be used carefully. Other hardliners do not want to admit it “may not be Armageddon” lest such an acknowledgment be seen as weakness by London, said one north European diplomat.
“We can’t have chaos. But it cannot be openly talked about,” the diplomat said. “We want to show we are able to even deal with the most severe outcome.”
A third European government officials overseeing Brexit preparations said: “The commission has prepared things to guarantee that we don’t fall off the cliff the day after withdrawal if we have no deal. But that contingency planning has to be extremely restrictive, otherwise it looks like a transition without strings attached.”
An October summit of EU leaders is seen by several European capitals as a turning point, where no-deal plans will be made more public if it is clear that a treaty agreement is not imminent.
On a practical level, the EU side also fears that revealing plans for a post-Brexit safety net will discourage the private sector from advancing its own contingency plans. Senior EU officials have told banks, for instance, that it is their responsibility to change the terms of relevant financial contracts signed since the Brexit June 2016 referendum.
In total, hundreds of pieces of EU and national legislation — both in primary and secondary law — are expected to be needed by EU officials overseeing planning.
In parallel to legal preparations, many countries are starting to bolster their capabilities to deal with a no-deal exit. The Netherlands and Belgium have announced plans to potentially hire hundreds of customs of customs officials and animal health inspectors, a move that Irish officials have also concluded would be needed.
All Britain’s closest trading partners are also looking at the additional infrastructure they may need at ports.
Trump choice for Supreme Court could alter its balance for years
Justice Anthony Kennedy’s retirement sets stage for fight with Democrats on successor
US Supreme Court Justice Anthony Kennedy on Wednesday announced his retirement from the bench, affording President Donald Trump the opportunity to name his replacement — a move that could dramatically alter the ideological leaning of the court for years to come.
Who will be Justice Kennedy’s replacement?
Last year, the White House released a list of 25 names it said the president would pick from the next time he was given the opportunity to replace a Supreme Court justice. Among them, two names stand out — William Pryor, a US court of appeals judge from Alabama, and Thomas Hardiman, a US court of appeals judge in Pennsylvania, both of whom Mr Trump interviewed before choosing Neil Gorsuch to fill the vacant seat of Antonin Scalia.
Democrats have criticised the shortlist for its lack of diversity. Just six on the list are women, while all but three are white. The youngest, Patrick Wyrick, a justice on the Oklahoma Supreme Court, is just 37, meaning he could potentially sit on the bench for the next five decades.
How soon could Justice Kennedy’s replacement be confirmed?
Both Mr Trump and Republican Senate leaders have vowed to have a quick and speedy confirmation process for the president’s eventual pick, raising the possibility that senators are likely to spend more time in Washington to get the confirmation through by the autumn.
Republicans believe it is in their best interest to get the new justice confirmed by the November midterm elections — first, because they have control of the Senate, and second, because they believe it will play well with Republican voters, many of whom have supported the president primarily because he promised to appoint true conservatives to the court.
Senate majority leader Mitch McConnell has vowed that the Senate will vote on Mr Trump’s pick in September. Many Democrats, however, have promised to play hardball, and slow down the confirmation hearings with delaying tactics.
Will any Democrats vote for Mr Trump’s pick? Will any Republicans vote against?
In the Democrats’ case, quite possibly. In April 2017, three Democratic senators voted to confirm Mr Trump’s first Supreme Court pick, Neil Gorsuch— Joe Donnelly of Indiana, Joe Manchin of West Virginia and Heidi Heitkamp of North Dakota. All three Democrats face highly competitive re-election races in November in states that voted for Mr Trump in 2016.
There are 51 Republicans in the 100-seat Senate. In 2017, Mr McConnell invoked the “nuclear option”, ending the supermajority once needed to confirm a Supreme Court justice, so a simple majority of 51 senators would push the nominee through.
Before that crucial change, in 2016 Republicans refused to hold a vote on Barack Obama’s Supreme Court nominee, Merrick Garland, in the run-up to the presidential election that year. Republicans held the seat open until Mr Trump appointed Mr Gorsuch.
On the Republican side, it is possible Mr Trump could lose one or two votes. John McCain, Jeff Flake and Bob Corker have all clashed with the president; Susan Collins and Lisa Murkowski parted ways with their party to vote against the Republican repeal of Obamacare last summer. Yet if Mr Trump appoints a middle-of-the-road conservative justice, along the lines of Mr Gorsuch, with no controversial biographical footnotes, it would be hard to imagine any of those five senators voting against.
At the same time, it is unclear whether Mr McCain, who has been battling a deadly form of brain cancer at home in Arizona, will be able to take part in the vote, meaning Mr McConnell has even less room for error.
What are the long-term implications for the court?
Democrats have warned that Justice Kennedy’s replacement could alter the course of the court for decades to come. They are right. For the past decade, Justice Kennedy has been the only swing vote, voting to uphold restrictions on abortions, but to legalise gay marriage in the US. Few believe that Mr Trump will appoint a justice who could swing in a similar way — one of the reasons that liberals are so worried about the appointment. Moreover, most of Mr Trump’s top picks are in their forties and early fifties, easily giving them decades to serve on the court. The oldest justices following Justice Kennedy’s departure will be Ruth Bader Ginsburg and Stephen Breyer, both from the court’s liberal faction.
Among Democrats’ biggest worries in the immediate term will be the future of abortions and gay rights in the US. Mr Trump has previously said he planned to appoint justices who would overturn the landmark ruling Roe v Wade, which legalised abortion in the US. Liberals also worry that a more conservative court will mean more protections for corporations and fewer for minorities.
Lyft’s Valuation Doubles to $15.1 Billion Over One Year in Battle With Uber
Fidelity is leading a $600 million round to help Lyft keep apace of its bigger rival
Ride-hailing firm Lyft Inc. has raised new capital that doubles its valuation from last year to $15.1 billion and gives it more firepower as bigger rival Uber Technologies Inc. tracks toward an initial public offering.
Lyft said it raised $600 million primarily from existing investors, about six months after raising $1.5 billion at an $11.5 billion valuation. It was valued at $7.5 billion in April 2017.
The new round is being led by asset manager Fidelity Investments, which has poured some $800 million into Lyft, and includes hedge fund Senator Investment Group LP and others.
The investment should help Lyft keep apace of Uber, which raised $1.25 billion in new capital in January from SoftBank Group Corp. and has said it is planning to seek an IPO in next year’s second half.
Lyft has weighed its own IPO, according to people familiar with the matter, though it may not beat Uber to the punch. With Uber valued recently at $72 billion as part of a settlement granting equity to Alphabet Inc.’s Waymo, its IPO is likely to be one of the largest in recent memory.
Both companies are battling for the future of transportation, investing billions in yet unproven self-driving vehicles and snapping up technology and competitors that offer rentable bicycles and scooters for shorter hops within urban centers.
Lyft gained U.S. market share last year as Uber struggled with a series of scandals and legal setbacks. However, Lyft’s market share leveled in recent months to around 24%, or 27% when not including Uber’s Eats food delivery service, according to Second Measure, which tracks credit-card transactions. Lyft said in May it held 35% of the U.S. ride-sharing market.
The two San Francisco companies are battling on several fronts. Lyft last year moved into its first international market, Canada, and has eyed expansion into Europe and Latin America, according to people familiar with the matter. Lyft and Uber also are racing to develop self-driving vehicle technology that they believe could dramatically improve the profitability of ride-sharing and reduce traffic fatalities.
Both firms have filed applications in San Francisco for permits to operate electric scooters on city streets and are working on partnerships with public agencies to list transit times on their apps. Uber bought Jump, an electric bicycle company, for around $200 million and Lyft is negotiating the purchase of Motivate, known for its docked bikes such as the ubiquitous Citi-branded ones in New York.
This year Lyft is on a pace to record $7.7 billion in gross bookings, the amount it takes in before paying out drivers, according to a person familiar with the matter. Uber, by comparison, had $37 billion in gross bookings last year.
Since it was founded in 2012, Lyft has raised $5.1 billion to date, compared with more than $16 billion for nine-year-old Uber.
Corrections & Amplifications
Prior Lyft investors including the CapitalG unit of Google parent Alphabet Inc., KKR & Co. and Japanese e-commerce firm Rakuten Inc. did not participate in the most recent funding round. An earlier version of this article incorrectly stated that they were participants. (June 27, 2018)
Takeda shareholders reject proposal demanding in-advance shareholder approval for large-scale acquisition
28 JUN 2018
Takeda Pharmaceutical [TYO:4502] shareholders, at the company's annual regular shareholders meeting held earlier today (28 June), rejected a proposal that demanded for the company to obtain in-advance shareholder approval for a large-scale acquisition, according to a newswire report.
The proposal, which was made by a group of Takeda shareholders, was voted against at the shareholders meeting, Reuters reported, citing a company spokesman.
The proposal demanded for the Japanese pharmaceutical firm to change its corporate article that requires the company to obtain in-advance shareholder approval for any aquisition plan with a value in excess of JPY 1tn (USD 9bn), according to the report.
Proxy advisor International Shareholder Services (ISS) was recommending that Takeda shareholders vote against the proposal, the report added.