Telegraph : EU officials 'believe Britain will give up on Brexit if they make ne

EU officials 'believe Britain will give up on Brexit if they make negotiations tough enough'



Senior figures in the EU believe that Britain will give up on Brexit if they make negotiations as tough as possible, the Telegraph understands.

British officials are fighting to stop Europe adopting a no-compromise position in talks in the hope that the UK will change its mind about leaving the bloc.

This belief is fuelling the hardline message on issues like freedom of movement that have emerged from Berlin, Paris and Brussels in recent weeks.

More than five senior EU figures interviewed by the Telegraph this week expressed doubts that Britain would go through with Brexit when confronted by the “reality of the bureaucratic nightmare” and the “insane act of economic self-harm”, as they referred to Brexit.

One senior British official involved in the set up for the coming negotiations said the EU elite “seem to think the game is to make us change our minds”.

This stance has left officials fighting to explain to European leaders how “dangerous” a game they were playing, and how “unlikely” it was to succeed.

Who are the Brexit ministers?Play! 01:33
A second UK official source with knowledge of the talks added there was a danger that positions in the Brexit talks were already becoming “dangerously entrenched”, even before Theresa May invokes Article 50 that will open formal EU-UK "divorce" proceedings.

The sense that battle-lines are hardening across Europe came as the 27 EU leaders prepared for a summit on Friday in the Slovakian capital, Bratislava, designed to demonstrate unity and a determination to forge ahead with a European future without Britain.

The toughening mood was darkly hinted at by Donald Tusk, the European Council president, in a nine-point letter urging EU leaders to use the Bratislava summit to restore citizens' fading faith in the European Union.

In a thinly veiled appeal to make sure Britain was left demonstrably worse-off by Brexit, Mr Tusk insisted that the 27 should resolutely “stick to the Treaty” on issues like free movement.

“If we do so, there will be no room for doubt that it is a good thing to be a member of the Union,” he wrote.

Tusk tells May to get on with Brexit: The ball's in your courtPlay! 01:31
The EU’s choice of lead negotiators – the French finance expert Michel Barnier, for the European Commission and Guy Verhofstadt, the former Belgian prime minister and arch-ferderalist, for the Parliament – has also been taken as a clear sign of the EU’s determination to drive a hard bargain.

The appointments were described on Thursday as "very, very tough" by Herman van Rumpuy, the former European Council president, who warned that negotiations would be “difficult” for Britain.

In the European Parliament, which must ratify any Article 50 deal agreed by the EU 27, the mood against Britain was further soured this week by personal attacks on Mr Verhofstadt by former Ukip leader Nigel Farage and the Brexit secretary, David Davis.

Mr Davis referred to his future interlocutor as “Satan” when addressing the Foreign Affairs select committee, while Mr Farage – long a thorn in the side of pro-EU MEPs – lambasted Mr Verhofstadt as a “fanatic” whose appointment amounted to “declaring war” in the coming talks.

Nigel Farage calls EU's top Brexit negotiator a 'fanatic'Play! 01:27
“Perhaps there was a time when this could not have got nasty,” said one source close to Mr Verhofstadt, “but when the Brexit minister calls the chief negotiator ‘Satan’ what response, really, does Britain expect?”

Those sentiments were echoed by Burkhard Balz, a German MEP whose leading role on the European Parliament’s economic and monetary affairs committee makes him influential on financial services regulation, said Britain must not underestimate the determination of the rest of Europe to deprive the UK of its EU financial passporting rights and euro clearing.

He also warned Europe would accept economic pain to defend its core principles and that the belief among Brexiters that the demands of German and French exporters could substantially soften terms was overblown.

“This summer I travelled all over Germany, and the main reason was to talk about Brexit. Every time, in every place, the biggest round of applause was when I said the ‘the time of cherry-picking and rebates is over’. That is how the German people feel about the situation,” he told the Telegraph.

Nordea wants reasons for ABB to keep Power Grids business

Nordea wants reasons for ABB to keep Power Grids business - Reuters News

STOCKHOLM, Sept 15 (Reuters) - ABB ABBN.S must come up with convincing reasons to keep the company's power grids division when it updates shareholders on the business next month, another of the group's largest investors said, adding to pressure on the group to break up.

Nordea NDA.ST, the 10th-biggest owner of ABB with a 0.6 percent stake in the Swiss industrial robot and power station maker, said it was unclear why ABB should remain as one company.

Activist investor Cevian has already called for ABB to spin off the Power Grids business, which makes components for off-shore windfarms and high voltage cables, and has previously been a drag on the overall performance of ABB. (Full Story)

Another big investor, Artisan Partners, has echoed that call. (Full Story)

"We see question marks around why ABB should remain as one unit, and we think the burden of proof lies on the company to show why it should remain," said John Hernander, portfolio manager at Nordea Asset Management.

Power Grids, which generated sales of $11.6 billion in 2015, has improved its profitability in recent quarters as it ditched risky projects, but remains ABB's least profitable division.

"While profitability has been better than expected lately, it is still not obvious that these units should be under the same roof," Hernander said.

"All options are being considered in our strategic review of the Power Grids business and, as we have previously said, we will give an update at our Capital Markets Day on Oct. 4," said ABB spokesman Saswato Das.

RTR- Novartis says 'never say never' to Alcon disposal


Novartis (NOVN.S) cannot rule out selling its Alcon eye care and surgery equipment division, its chief lawyer said on Thursday, helping fan speculation the Swiss drug company could offload a business that has been struggling to revitalize sales.
General Counsel Felix Ehrat told a mergers and acquisitions conference in Zurich that Alcon's position as a leading surgical instruments maker fits Novartis's overall strategy of focusing on divisions which are among the largest players in their respective sectors.
However, pressed on whether Novartis would rule out the prospect of an Alcon sale, Ehrat said at the conference organized by Swiss newspaper Finanz und Wirtschaft that such a pledge "wouldn't be clever".
"Never say never," he added.
Early this year Novartis Chief Executive Joe Jimenez replaced Alcon's chief executive following successive quarters of falling sales, attributing the poor performance to a lack of innovative new products and waning customer focus.
The division's new boss Michael Ball is concentrating on top-line growth at the expense of profitability as he seeks to reinvigorate sales by year's end.
But Alcon's poor performance and status as a device maker following the move this year of its ophthalmic drugs business into Novartis's main pharmaceuticals division, has fueled talk it is on the disposal block, especially if Ball's turnaround effort fails.
"Alcon will either be fixed or sold," David Evans, an analyst at Kepler Cheuvreux, wrote in a recent note to investors.
Sales have been in decline since 2014 at Alcon, which the Swiss drugmaker gradually bought up from food maker Nestle in a series of deals totaling $51 billion, with the final portion acquired at the end of 2015.

Last year sales at Alcon fell 9 percent to $9.8 billion, including $3.8 billion from the drugs business which has since been moved out of the division.
Novartis had sought to integrate the unit and its U.S.-centric culture - Alcon is based in Fort Worth, Texas - into the rest of the company, Ehrat said on Thursday, but a business model vastly different from the patent-protected world of drugs may have hampered the effort.
"As the current, temporary difficulties may illustrate, not everything worked optimally," Ehrat said. "I wouldn't say that's a result of failed integration, rather the result of a not 100 percent successful integration."

>>> US Gapping Up

Gapping up
In reaction to strong earnings/guidance
:
  • NTWK +11.8%, APOG +8.2%, STB +5.5%, LAKE +3.7%, GT +3.5%, (outlines growth plan, financial targets at Investor Day), JRJR +2.9%
Select EU financial related names showing strength: CS +2.3%, HSBC +1.5%, PUK +1.1%, DB +0.8%, SAN +0.5%

Select oil/gas related names showing strength: RIG +2.2%, WLL +1.6%, MRO +1.6%, SDRL +1.4%, BT +1.1%, YNDX+0.7%

Other news:
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  • ACRX +12.2% (Phase 3 trial (SAP303), ARX-04 was well tolerated in the management of moderate-to-severe acute pain in post-operative study patients )
  • ACTG +10% (favorable judgement against Apple in patent case)
  • DRYS +8.7% (DryShips agrees w/ Sifnos Shareholders to convert $8.75 mln of its revolver to 3.5 mln preferred shares)
  • CLSN +4% (announces the DSMB has completed its safety review of data from the first three patient cohorts in the ongoing Phase Ib OVATION Study)
  • JKS +2.5% (enters into a Master Module Supply Agreement with Con Edison Development)
  • TWTR +1.5% (continued strength)
  • CIE +1.3% (closed near lows after S&P lowered Cobalt International Energy Inc. unsolicited credit rating to 'CCC-' on possible restructuring; Outlook Negative)
Analyst comments:
  • ARNA +6.5% ( initiated with a Outperform at FBR & Co.; tgt $6)
  • BLUE +4.7% (added to Conviction Buy List at Goldman Sachs; tgt $135)
  • RIG +2% (upgraded to Hold from Sell at Canaccord Genuity)
  • GPN +1.4% (upgraded to Buy from Neutral at Goldman)
  • AAPL +1.3% (iPhone est raise at Credit Suisse)

>>> US Gapping Down

Gapping down
In reaction to disappointing earnings/guidance
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  • SBLK -10.1%, (also announces a $51.5 mln underwritten public offering of common stock), CLC -4.7%
Other news:
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  • ARLZ -12.1% (shares halted for news pending, still checking)
  • SBLK -10.1% (announces a $51.5 mln underwritten public offering of common stock)
  • PAH -7.4% (commences a $350 mln underwritten public offering of common stock)
  • SQNS -6.3% (to offer newly issued American Depositary Shares in an underwritten public offering)
  • MSON -4.6% ( files for extension of time for annual report on form 10-K, appoints Joseph Dwyer as interim CFO, reports prelim results for the year ended June 30, 2016 ), MCFT -3.1% (prices secondary offering of 4 mln shares helf by institutional investors at $10.25 per share)
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  • LXRX -2.1% (FDA extended PDUFA date 3 months for Telotristat Etiprate for the treatment of carcinoid syndrome to February 28, 2017 from November 30, 2016 )
  • BSPM -1.5% (slightly pullig back following yesterday's big move)
Analyst comments:
  • VFC -3% (downgraded to Underperform from Buy at BofA/Merrill)
  • SNY -1.2% (resumed with a Underweight at JP Morgan)
  • CTSH -1.2% (downgraded to Neutral from Buy at Goldman)
  • SYNT -0.8% (downgraded to Underperform from Market Perform at William Blair)