TheChek News Flow

A startup called Jibo will soon introduce a social robot for the home. One for the office can’t be far behind.

The sense of fear and loathing is rising as workers — especially once-secure-feeling knowledge workers — begin to see the threat that artificial intelligence poses to their livelihoods. Increasingly capable algorithms and robots are starting to perform tasks that previously required college degrees to tackle, like determining how an insurance policy should be priced, or what medical diagnosis best matches an unusual set of symptoms, or which marketing messages will generate most sales. Automation, which used to steal the jobs of those who did dangerous, dirty and dull work, is now threatening decision-makers and experts.

As workers try to get a bead on this threat, however, most tend to look upward, toward the managers and IT departments they suspect will wheel in the machines to outperform them. You might do better to glance to your side. The cognitive technology that puts pressure on your job is more likely to be your cubemate’s.

Here’s how it might well go down. Your colleague is just as stressed-out as you are at the rising imperative to do more with less, and the shrinking prospects of jobs, promotions, and raises. He is also equally frustrated by the amount of time he is spending on routine, codifiable parts of the job he mastered long ago. But being slightly more tech-savvy than you, he also spots a solution. By opening his own wallet and making a software purchase — taking advantage of the ever-plummeting cost of processing power — he shows up to work one day with an AI assistant in tow. Just as he made it to work faster than you because he used Waze to navigate through traffic, at work he’s able to make better investments, call on better customers, or make more accurate production forecasts than you.

The idea of "bring your own robot" is not as farfetched as it may seem. There are already automated tools that support a wide variety of specific tasks. And robots are getting easier to interact with. The new thing in manufacturing is "collaborative robots," which are much easier (and less dangerous) to train and work alongside. MIT professor Cynthia Breazeal has been working on "social robots" in the lab for a couple of decades, and is now an executive in a startup, Jibo, that will soon introduce a social robot for the home. One for the office can’t be far behind.

When it arrives, your colleague may become twice as productive and effective as you, and motivated enough to spend his found time cooking up innovations and other clever ways to serve the company’s customers better. He’s a superstar. Can you follow suit fast enough by bringing in your own robot helper? Maybe — but it’s doubtful that everyone in your department can. Will there even still be enough work to go around? If not, the most technically astute are most likely to keep their jobs.

There is a clear precedent for what we are describing. Starting a decade ago, IT departments started raising red flags over what they called the BYOD (Bring Your Own Device) movement. Suddenly, we were living in a world where the laptops, tablets and smartphones people bought for themselves were more powerful and flexible — and way more cool — than their employers’ standard issue.

Meanwhile, with boundaries between work and home life eroding, workers saw no sense in switching over to different devices at, say, 9 am and 5 pm. They started using their own tech in the office. At first, this was the scourge of corporate security, to be discouraged at all costs. But in much the same way that companies have embraced work-at-home arrangements, it was soon enough seen as a way to get higher performance without budgeting more for property, plant and equipment.

But if BYOD didn’t displace many workers we can point to, things may be different with the AI-enabled devices of the very near future. Dramatically more capable, they may be all the more welcome in workplaces, and could create enormous gulfs between the performance of those who invest in them and those who do not. How many managers and professionals have daydreamed of hiring assistants, even at their own expense, to enable them to outperform the rest of the pack — but could never follow through on the wish in their strictly controlled HR environments? Now they can do it, the expense will be manageable, and the arrangement will only get cheaper with time. Intelligent tools like IBM Watson once cost millions to buy, but they are rapidly evolving into smart, inexpensive "bots" or APIs that undertake specific cognitive

Peer-introduced AI in workplaces might therefore demonstrate the possible, and set the tone for the employer-sponsored implementations of smart machines that will eventually follow. We suspect that, henceforth, at least as many process improvements will percolate up from the people doing work as will be imposed by the managers sitting layers above them. It usually takes someone who really knows both the job and the capabilities of technology to specify the right division of labor.

So if you’re worried about the rise of the robots and what it might mean for your employment situation, don’t expect the invasion to come from above. Look for it on all sides. And maybe stop assuming you can’t be friends with those smart machines.

Amec M/P Awarded FEED contract by Kuwait Oil Company -no financials

Autoliv -2% KKR said to seek control of Takata (Takata could survive)

Balfour UNCH Awarded contract for M20 lorry area - worth £120m

B&M +2-3% Pre-tax profit 2% beat, EBITDA 2% beat, special divi of 10p

Bureau Veri -0.5% CFO Sami Badarani to leave, replaced by Nicolas Tissot

Daily Mail -3-4% Company now see DMG op margin at 10% from 13%

Debenhams +1-2% Names Amazon's Sergio Bucher as CEO

Evolva +2-3% Receives patent for Steviol Glycosides

Inchcape +2% Peformance inline with co expectations

Miners +0.5% Copper +0.65%, Brent +1.75%, Iron Ore +0.45%, China -0.92%

Oils +0.5% WTI +1.8% vs Europe close and Brent trades above $50

NN Group UNCH Q1 operating 2% light, launching a Eu0.5bn buyback

Pets at home -2% Numbers inline but margins a touch negative

QinetiQ M/P Revs slightly light, FY17 remain unchanged

Sanofi M/P Wins FDA Panel’s Backing for Once-Daily Diabetes Combo

Seadrill +1-2% Q1 Revs inline, EBITDA 14% ahead

Tate & Lyle +1-2% PBT 193m adjusted vs 190m, confident on progress

United Utils UNCH EBIT inline, EPS at 47.7p consensus at 48.4p

BANCO POP Capital raise of EU2.51bn. EU1.25/shr price for each sh. -10%

BME Prelim results, bang in line, will pay special div in July. +3%

DMGT Op margin c.10%, guided to c.113%, div slightly lower. -2%

INCHCAPE Good start, expects to deliver constant performance in 2016 +1%

NN Buyback EUR500m vs JPMe 250m. Dutch life well ahead. +2%

SOPHOS Very strong performance, LFL billings +20% YoY. +3%

SPAN BANKS POP raise will read to the sector. -2%

TATE FY16 op profit 2% below, PBT ahead. EPS above. unch

UU's Revenues, EPS in line unch

* B&M EUROPEAN +1%; Numbers bang in line with a £100m special divi announced.

* BALFOUR BEATTY mkt; M20 contract award.

* BENCHMARK +1%; Update in-line, development pipeline is progressing well, confident outlook.

* CLIPPER unch; Trading inline, full roll out of John Lewis collaboration, no change to #’s, we go to HOLD fm BUY target remains 290p.

* DMGT -2%; Mixed statement, advertising remains challenging in the 8wks to May 22nd.

* FOXTONS mkt; New CFO.

* HOSTELWORLD -5%; Q2 trading below expectations due to geo-political events.

* IBSTOCK -2%; TU good trading momentum in to '16, FY expectations broadly unch.

* IMAGINATION TECH -2%; Takes £50m exceptional, underlying trading inline, Heath appointed CEO.

* INCHCAPE +1%; Strong revenue performance and confident on outlook.

* LONDONMETRIC mkt; Development site acqn in Crawley.

* PAN AFRICAN RESOURCES +5%; Acquisition & placing of 111m shares @ 14.25p, (£16m) @ 5% premium to last night close.

* PAYPOINT -1%; Net revenue in line.

* POWERFLUTE unch; Update & AGM all in line.

* QINETIQ -2%; Top line miss but bottom line as expected. Markets remain challenging. Outlook unch.

* SOPHOS +3%; Headline numbers strong, confident outlook.

* STOBART mkt; Completion of disposal of investment property for £37m.

* TATE & LYLE +1%; Finals in-line, small beat on PBT £193m V £191m est. margin expansion in both divisions, confident outlook.

* UNITED UTILITIES -1%; Revenue was £1,730m,underlying operating profit was £604m, lower than last year (£664m) as expected.

* VECTURA +2%; Numbers small beat. Advate patent loss as expected. CFO to step down post merger.

ASOS - co-founder sells 1.3m shares @ 3525p to cover divorce settlement....UNCH

TATE & LYLE - sales +1% £2.35bn,PBT +5% £193m,restructure cost below f'cast.+2%

DEBENHAMS - announces Sergio Bucher as new ceo, ex VP of Amazon Europe.....UNCH

DAILY MAIL - revs -1%,oper.pft -12%,lowers dmg media margin g'dance.........-3%

VECTURA - revs +24% £72m,EBITDA +43%,profits +35%,royalties impacted........-2%

IBSTOCK - good trading momentum continues,sees FY expectations unchanged....+1%

HENRY BOOT - all units trading well,confident on meeting FY expec..........UNCH

BALFOUR BEATTY - Awarded contract for M20 lorry area........................+1%

INCHCAPE - 4 month lfl revs +11.3%.Ptp.Have had good start to year..........+1%

IMAGINATION TECH - Restructure to result in 50m charge.Performance in line..-3%

PETS AT HOME - Group rev 793.1m.Sees margins this yr hit by weaker currency.-1%

DARTY - total revs +12.8%,LfL +12%,margins -160bps,debt lower..............UNCH

Bayer [ETR:BAYN] has hired the public relations companies Brunswick, Sard Verbinnen, CNC, Finsbury and Hering Schuppener to work on its USD 62bn (EUR 81.58bn) takeover bid for Monsanto [NYSE:MON], the Financial Times reported.

The newspaper did not cite a source for the information, but quoted Bayer chief executive Werner Baumann, who said the German pharmaceuticals and chemicals group is working on “reputational measures” and that the company is working with agencies to address issues of reputation management and communications.

Hering Schuppener and Finsbury are advising Bayer specifically on reputational issues, the item said.

Bayer announced on 23 May that it had approached Monsanto, a St Louis, Missouri-based crop science company, about a takeover offer at USD 122 per share. Monsanto on 24 May said it had rejected the offer as incomplete and financially inadequate, but added that it was open to further talks to explore whether a deal was possible.

The Financial Times report noted that some advocacy groups, including Campact, are against the proposed deal. Campact has urged supporters to petition against the proposed tie-up, the item said, adding that a petition has gained 92,900 signatures.

Monsanto’s business of genetically modified (GM) seeds has proved controversial, as has its association with the chemical glyphosate, which is used in the weed killer Roundup. The World Health Organisation has said Roundup is probably carcinogenic, the item noted.

The European Union is considering whether to grant glyphosate a renewed licence and several large EU members are opposed to renewing the licence, the article added.

Bayer’s head of crop science strategy, Mathias Kremer, said Europe is the only region in which genetically modified organisms (GMOs) are controversial, adding that GMOs are seen as either positive or neutral worldwide.

Baumann concedes that shareholders have informed him of concerns about the reputational risk that could come with a takeover of Monsanto, the article said.

Separately, The Times reported that the US National Farmers Union has asked the US Department of Justice to give carefully and critically review any deals including the proposed tie-up between Bayer and Monsanto that would lead to less competition in the agricultural sector. The newspaper quoted the NFU, which said the agricultural sector is already “heavily concentrated.”

Financial Times, The Times (London)

Dow +0.82% S&P +0.69% Nasdaq +0.70% Russell +0.50%

Macro :

- Hedge Funds May Lose Quarter of Assets, Blackstone’s James Says

- China Accuses U.S. of Protectionism Over Steel Decision

- Greece Plans to Limit Cash Transactions to EU500: Kathimerini

- French Cour Des Comptes Contests Extend of 2015 Deficit Decline

Keep an eye on :

- AIR FP : Airbus Helicopters to Reveal X3 Successor, Flight Magazine Says

- ALO FP : Alstom Outlook to Stable From Negative by S&P; Rating Affirmed

- BVI FP : Bureau Veritas Appoints Nicolas Tissot Chief Financial Officer

- COL SM : Colonial to Make Investments For More Than EU400M, Raise Capital ( €265mil cap increase )

- CRTO US : Criteo to See ‘Only Modest Impact’ From Loss of FBX: Evercore

- EDF FP : French Nuclear Watchdog Says Industry Challenges ‘Unprecedented’

- ENGI FP : French raise doubt about future of Victoria's Hazelwood coal plant

- LEY FP : Faiveley Sees Sales, Adj. Op. Profit Rising in 2016-17

- FCC SM : FCC to Make Bid for All of Cementos Portland at EU6 Per Share

- FIA1S FH : Finnair Appealing Even as Potential M&A Delayed, HSBC Says

- LUMI SS : Lundin Mining Approached by Investors Regarding Tenke: DI

- MUV2 GY : Munich Re Gets Double Upgrade as Yield Trumps Earnings: Goldman

- NN NA : NN Group 1Q Operating Result Stable, Net Result Declines

- NUM FP : SFR Completes Purchase of Altice Media Group France

- PHIA NA : Philips possible prey for future takeover, former managers say - NRC Handelsblad

- POP SM : Popular Approves Capital Increase For EU2.51 Billion

- PST IM : Italy Plans to Sell 29.7% Poste Italiane Stake on Market

- RCS IM : RCS shares rise on market chatter of possible third bidder - Il Sole 24 Ore, Italmobiliare May Rival Cairo, Bonomi-Led Group W/ RCS Bid: Sole

- RTN LN : Restaurant Group Shares Climb Suddenly Into Close of Trading

- SAN FP : Sanofi Wins FDA Panel’s Backing for LixiLan to Treat Diabetes

- SGO FP : Saint-Gobain to Cancel 11m Shares on May 30

- SoftBank (9984) : SoftBank Leads Nikkei Decliners After SEC Starts Alibaba Probe

- Takata (7312) : +21% on potential intereste from KKR

- TEC FP : Technip Awarded Contract to Provide Basic Engineering and Proprietary Equipment for Furnace Project in Saudi Arabia

- UBI FP : Ubisoft Said to Seek White Knight to Fend Off Vivendi Advances

- VAC FP : Pierre Et Vacances-Center Parcs 1H Rev. EU585.5m Vs EU650.7m Y/y

- VIV FP : Ubisoft Said to Seek White Knight to Fend Off Vivendi Advances

- WBMD US : WebMD Health Falls 3.7% Post-Mkt on $300m Convertible Deal