Yahoo Finance Plus 
The White House will propose $1 trillion worth of new taxes, according to Sarah Bianchi, head of U.S. public policy and political strategy at Evercore ISI and the former director of economic and domestic policy for then Vice President Joe Biden.
Gold prices held firm on Monday, supported by a weaker dollar ahead of the U.S. Federal Reserve's meeting this week, while supply worries kept palladium near record highs hit in the previous session. Spot gold was up 0.1% at $1,779.73 an ounce by 0931 GMT. "The main focus this week will be the FOMC (Federal Open Market Committee) meeting on Wednesday and what kind of signals that will be sent from there."
(Bloomberg) -- Chinese companies are listing in the U.S. at the fastest pace ever, brushing off tensions between the world’s two biggest economies and the continued risk of being kicked off American exchanges.Firms from the mainland and Hong Kong have raised $6.6 billion through initial public offerings in the U.S. this year, a record start to a year and an eightfold increase from the same period in 2020, data compiled by Bloomberg show. The largest IPO is the $1.6 billion listing of e-cigarette maker RLX Technology Inc., followed by the $947 million offering of software company Tuya Inc.That’s even as Sino-U.S. tensions show few signs of easing and the threat of Chinese firms being delisted from U.S. exchanges remains. In fact, the U.S. Securities and Exchange Commission said last month it would begin implementing a law forcing accounting firms to let U.S. regulators review the financial audits of overseas companies. Non-compliance could result in a delisting from the New York Stock Exchange or Nasdaq.The risk for mainland firms is high given China has long refused to let U.S. regulators examine audits of its overseas-listed companies on national security concerns.“They would acknowledge this is a potential risk, and if something happens they might need to get prepared for a rainy day,” said Stephanie Tang, head of private equity for Greater China at law firm Hogan Lovells. “But the risk itself would not prohibit those companies from going to the U.S., at least in the second half of this year or probably toward next year.”Despite all the risks, the pipeline continues to grow, setting up 2021 to potentially exceed last year. Chinese firms raised almost $15 billion through U.S. IPOs in 2020, the second highest on record after 2014, when e-commerce giant Alibaba Group Holding Ltd. fetched $25 billion in its float.Didi Chuxing has filed confidentially for a multi-billion-dollar U.S. IPO that could value the Chinese ride-hailing giant at as much as $100 billion, Bloomberg News has reported. Uber-like trucking startup Full Truck Alliance is also working on a U.S. listing this year that could raise about $2 billion, people familiar with the matter said, requesting not to be named because the matter is private.“Chinese companies in the new economy do not seem to have been deterred from seeking U.S. listings despite the ongoing tensions,” said Calvin Lai, a partner at Freshfields Bruckhaus Deringer. “They take that as one of the risks but that doesn’t tilt the pendulum.”Additional share sales by Chinese companies have also been well-received in the U.S. this year, delivering an average return of 11% from their offering prices in the following session, according to data compiled by Bloomberg.And while rival financial centers like Hong Kong have in recent years changed their listing rules to make it easier for new economy firms to go public there, that has not stopped the flow of firms going stateside. In fact, the traffic now goes both ways, with U.S.-traded Chinese firms getting a second listing in Hong Kong to expand their investor base and as a hedge against the delisting risk.Such secondary listings raised almost $17 billion last year and have fetched over $8 billion this year already, Bloomberg data show. Bankers said many companies go to the U.S. knowing they can subsequently list in Hong Kong.For example, Didi is also exploring a potential dual offering in Hong Kong later, a person familiar with the matter has said, while Chinese electric carmaker Xpeng Inc. is also looking into a share sale in the financial hub less than a year after going public in New York.To be sure, it’s not all plain sailing for everyone. TikTok parent ByteDance Ltd.’s IPO plans have been put on hold as it seeks to comply with regulatory demands from both China and the U.S., the South China Morning Post reported on Saturday. The world’s most valuable startup is struggling to find a business structure that satisfies both Beijing and Washington, the report said, with the separation of Douyin, the domestic version of TikTok, from its global peer posing a particular challenge.U.S. capital markets have long attracted Chinese companies for a number of reasons: their greater liquidity, broader investor base, and the cachet associated with a U.S. listing. Technology and fintech firms have flocked to the U.S. because of its more streamlined process as well as greater openness to loss-making businesses.“The U.S. still remains a magnet for the IPOs of Chinese technology companies,” Tang said. “Just in terms of the pipeline, I don’t see any pause to that. I think the pipeline is very strong.”(Updates with ByteDance IPO plans in third last paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Mike Bowsher shakes his head in wonder when he hears yet another customer at one of his Buick-GMC dealerships near Atlanta has agreed to pay full sticker price of more than $71,000 for a top-of-the-line GMC Yukon XL Denali SUV that is still being assembled at a General Motors factory. Customers know what Bowsher has arriving by scanning the online inventories of his six stores in the region, and they are often willing to wait more than a week and pay full price to get their desired vehicle. "I'm selling about 150% of what I have on the ground," Bowsher said.
(Bloomberg) -- China’s plan to control the transport of live hogs to rein in the spread of African swine fever is set to reshape the market and create regional price differences in the world’s biggest consumer and producer of pork.The country will be split into five regions from May, the agriculture ministry said last week, and live pigs will not be allowed across the boundaries. The move will push down pork prices in the main producing areas in the north and increase the cost of the popular protein in demand centers in the south. If the controls stay in place over the longer term, companies will be forced to open more pig farms closer to where their customers are.China’s hog industry was devastated by African swine fever in 2018 and, while herd sizes have recovered since then, a recent resurgence drove up pork imports to a record last month. Prices have fallen, however, as the culling of herds increased domestic supply. Pigs are a very important source of protein in China with the market for pork sales worth about 2 trillion yuan ($308 billion) a year, according to figures from the Dalian Commodity Exchange.Some 20% of China’s pigs, or about 140 million live animals, are transported each year, mainly from the northeast to the south to meet demand for fresh meat, said Lin Guofa, a senior analyst at consultancy Bric Agriculture Group.“Some areas that used to call themselves no-pig counties or no-pig cities will have to build pig farms,” he said. But transport of frozen meat instead of live hogs will be encouraged, which will lead to an expansion of the cold-chain industry, Lin said.Northeast China is the top pig-producing region due to an abundant corn supply and relatively easy access to land, while the northwest region of Xinjiang has also been identified as an area in which to expand pork production.The controls will depress prices in the north in the short term and push them up in the south, according to Wang Zhong, chief consultant at Systematic, Strategic & Soft Consulting Co. That may eventually prompt big pork producers -- including Muyuan Foodstuff Co., New Hope Liuhe Co. and Wens Foodstuff Group Co. -- to build more hog farms in the south and more slaughtering facilities in the northeast and northwest.The new rules are similar to systems developed in Brazil and Spain, which have been successful in getting rid of African swine fever, the agriculture ministry said. While “the virus is still widely distributed and difficult to eradicate in the short term,” regional controls are an “inevitable choice,” it said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
In China's commercial hub Shanghai, six big state banks are quietly promoting digital yuan ahead of a May 5 shopping festival, carrying out a political mandate to provide consumers with a payment alternative to Alipay and WeChat Pay. The banks are persuading merchant and retail clients to download digital wallets so that transactions during the pilot programme can be made directly in digital yuan, bypassing the ubiquitous payment plumbing laid by tech giants Ant Group, an affiliate of Alibaba 9988.HK, and Tencent 0700.HK. "People will realise that digital yuan payment is so convenient that I don't have to rely on Alipay or WeChat Pay anymore," said a bank official involved in the rollout of e-CNY for the Shanghai trial, under the guidance of China's central bank.
Need some advice? Legendary investor and CEO of Berkshire Hathaway has plenty to share.
Bolstered by popular support, U.S. President Joe Biden plans to take from the rich to give to the poor, aided by advisers keen to address economic disparities and stop companies from avoiding paying taxes. Biden on the campaign trail in 2019 first signaled that he hoped to hike taxes on investment gains paid by the wealthy as a way to fund social programs, in that case healthcare. As president, he brought these advocates of progressive taxation, or a system where tax rates increase as income goes up, into the White House.
(Bloomberg) -- Blackstone Group Inc. has offered to buy a controlling stake in Indian IT outsourcing services provider Mphasis Ltd. for as much as 82.6 billion rupees ($1.1 billion) as demand for cloud computing surges amid the pandemic.Funds managed by the private equity firm have teamed up with long-term investors including Abu Dhabi Investment Authority and UC Investments to take a majority stake in Mphasis, the private equity firm said in a statement on Monday. That agreement triggered an open offer for an additional 26% stake in the Indian firm at 1,677.16 rupees apiece, or a 1.1% discount to the closing share price on Friday. The stock gained as much as 6.5% in Mumbai after the offer.Blackstone’s move to increase its stake in Mphasis is in sync with the U.S. asset manager’s plans to boost investment in the South Asian nation. India is the strongest performer in the world for Blackstone and the firm intends to continue deploying large investments in the nation, Blackstone Chief Executive Officer and co-founder Stephen Schwarzman said during his visit to Mumbai in 2020.“This investment enables us to continue creating value for the long term and provide additional resources to further accelerate the company’s growth momentum,” Amit Dixit, head of India for Blackstone private equity, said in the statement. Mphasis specializes in providing cloud and digital solutions and serves 35 of the top 50 U.S. banking, financial services and insurance firms, according to the statement.The open offer was triggered after Blackstone Capital Partners VI fund agreed to sell its 55.31% stake in Mphasis to an entity under Blackstone Capital Partners VIII and Blackstone Capital Partners Asia funds, according to a stock exchange filing. Blackstone is committing up to $2.8 billion for the controlling stake, according to the firm’s statement.Following the completion of the transactions, Blackstone is aiming to build MPhasis into a company worth $10 billion over the next four years, more than double its current valuation of about $4.4 billion, according to a person familiar with the matter, who asked not to be identified discussing internal targets. A representative for Blackstone declined to comment.Blackstone had purchased a majority stake in Mphasis in 2016 from Hewlett Packard Enterprise Co., paying 430 rupees per share at the time.(Updates with details about Blackstone’s plans for Mphasis in sixth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
European stocks clawed their way higher on Monday as world markets began the week in a relatively upbeat mood following further signs last week that economies are recovering rapidly. The start to the week was relatively quiet, however, as investors refrain from taking on large positions ahead of a two-day Federal Reserve meeting beginning on Tuesday and quarterly gross domestic product numbers for the United States. But the general sentiment remained bullish with Wall Street hitting another intraday record-high on Friday and European shares not far off record highs in early Monday trading.
Bitcoin rode the rollercoaster this week, but its overall volatility has been in decline.
(Bloomberg) -- Bitcoin rallied back Monday as investors took advantage of the lowest levels in seven weeks to pile back in.The largest cryptocurrency headed for its biggest gain since Feb. 8 at around $52,700 as of 9:35 a.m. in London. At one point it rose as much as 10.4%.The digital asset had been mired in a two-week slump after reaching a record on April 14, buoyed by enthusiasm from the Coinbase Global Inc. listing. Technical warnings from Wall Street, coupled with the collapse of two crypto exchanges in Turkey at the end of last week, had depressed sentiment amid fears over a growing bubble.Monday’s action shows some investors are buying the dip after a rout that pushed Bitcoin below its 100-day moving average.“The world is moving from centralized to decentralized; if you believe in that theme, it means the drop is a great buying opportunity,” said Michael Sikorsky, chief executive officer and founder of Copia Wealth Studios, in a recent note. “Volatility has always created opportunity, and people keep being surprised by the new highs month over month and year over year.”Billionaire Elon Musk, who in the past has affected prices with comments on Twitter, posted another potential reference to cryptocurrencies on Saturday. “What does the future hodl?” he asked, using a term often seen as meaning “hold on for dear life” that supporters use to refer to buying and holding their digital assets.Bitcoin futures weren’t pricing much more in the way of further gains Monday. April contracts rose to $52,585, while those for May through September were mostly in the $52,000s, according to data compiled by Bloomberg.“Bitcoin created a large gap down last week that could stick around far longer than bulls would want to see,” said Rick Bensignor, president of Bensignor Investment Strategies, in a note Monday.Some cryptocurrency-linked stocks rose along with Bitcoin. Monex Group Inc. gained 7.1%, while Remixpoint Inc. increased 7% and Ceres Inc. added 6.1%.Bitcoin has done well over the medium term, retaining a gain of about 80% year-to-date as big-name investors endorse it and institutions from Goldman Sachs Group Inc. to Bank of New York Mellon advance their offerings around cryptocurrencies. JPMorgan’s John Normand reiterated in a note Friday that Bitcoin’s ascent has been steeper than any other financial innovation or bubble of the past 50 years.(Updates with more context throughout)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Cryptocurrencies took a beating Friday as President Biden is expected to unveil a plan to raise capital-gains taxes for the wealthiest Americans.
(Bloomberg) -- After one of the most difficult years in the oil industry’s history, crude prices have recovered and major producers are finally generating spare cash. Investors really want to get their hands on it, but most are likely to be disappointed.That’s because the pandemic has created a legacy of debt for the world’s biggest international oil companies, many of which borrowed to fund their dividends as prices crashed.For Exxon Mobil Corp. and Total SE, which bore the financial strain of maintaining shareholder payouts last year, any extra cash will go to easing debt. Chevron Corp. and Royal Dutch Shell Plc have said they want to resume buybacks, but not yet. Only BP Plc is dangling the possibility that shareholder returns could improve soon, after a year and a half of flip-flopping over its payout policy.The coming week’s first-quarter results should show a significant improvement in both profit and cash flow after a dire 2020, but probably nothing that will change investors’ disenchantment with the oil majors.“They have limited appeal as long-term investments because they can’t demonstrate that they can deliver cash flow on a sustainable basis and return it on a sustainable basis,” said Christyan Malek, JPMorgan Chase & Co.’s head of EMEA oil and gas. “The key is consistency. We haven’t had any.”The first quarter will be an inflection point for the industry, according to JPMorgan. Company data and estimates compiled by Bloomberg show free cash flow -- what’s left after operational spending and investment -- is set to rebound to $80 billion for the five supermajors this year, compared with about $4 billion in 2020.Shell will be the top of heap with about $22 billion, Exxon will total $19 billion and even lowest-ranked BP will have about $11 billion. That will be enough for each of the five majors to cover their planned 2021 dividends and together have more than $35 billion left over.It’s unclear how much of that could make it into the pockets of shareholders.“Priorities for deployment of Europe’s oil majors’ strong first-quarter free cash flow will vary,” said Bloomberg Intelligence analyst Will Hares. “BP has achieved its debt target and is set to announce resumption of buybacks. Shell has announced a small dividend bump, though is unlikely to resume buybacks given its $65 billion net debt target.”BP’s BuybacksAfter raising its dividend by 2.4% in February 2020, then cutting the payout by half just six months later, BP has come under pressure to prove it can deliver reliable returns to shareholders.The London-based firm’s shares are the worst performing in its peer group over the last 12 months. Even its Chief Executive Officer Bernard Looney has acknowledged that investors are questioning whether BP can pull off its reinvention for the low-carbon age.Earlier this month, BP managed to set itself apart from its peers in a positive way, giving the clearest signal of impending buybacks. The company said it had achieved its target of reducing net debt to $35 billion about a year sooner than expected and will give an update on the timetable for stock repurchases on Tuesday, when it opens Big Oil earnings season.That’s a significant increase in the urgency of improving shareholder returns. Back in August, BP put its goal of returning 60% of surplus cash to investors fifth on the priority list after funding the dividend, reducing net debt, shifting expenditure into low-carbon projects and spending on core oil and gas assets.Debt ReductionBP’s European peers, whose shares have performed better in the past year, aren’t moving so fast.France’s Total, which was the only oil major in the region to maintain its dividend last year, has said that any extra cash that comes from higher oil prices will be used to cut debt. Its next priority will be to increase investment in renewables to about 25% of its overall budget. Buybacks will only come after that.Shell announced a 4% increase in its dividend in October, after cutting the payout by two thirds earlier in the year. It has a target of reducing net debt by $10 billion before it returns any extra money to shareholders. Banks including Citigroup Inc. and HSBC Holdings Plc predict that won’t happen until 2022, since net debt rose in the last quarter of 2020 to $75 billion.Unlike BP and Shell, the North American majors managed to make it through 2020 with their payouts intact, but at a high cost. Exxon’s debt pile surged 40% during the pandemic to $73 billion, prompting Moody’s Investors Service to downgrade the company’s bonds twice in the past 12 months.The Texas-based giant expects to return to profit in the first three months of 2021 after four straight quarterly losses. The company has said it will maintain its $15 billion annual dividend while paying down debt if oil and gas prices remain at current levels. JPMorgan sees Exxon’s free cash flow rebounding to $19.6 billion this year, giving it a sizable surplus with which to reduce borrowings.Of the five supermajors, Chevron has the best balance sheet and “strong prospects” for a share buyback, according to HSBC analyst Gordon Gray. The California-based company said in March that it should generate $25 billion of free cash over and above its dividend through 2025 if Brent crude remains at $60.The oil majors’ focus on pleasing investors and healing their financial wounds comes largely at the expense of investment in their core business.As the pandemic unfolded last year, the companies slashed their spending to the lowest combined level in 15 years, according to data compiled by Bloomberg Intelligence. The stranglehold will continue this year, with capital expenditure set to rise only slightly despite oil’s recovery.Chevron and Exxon have both locked in spending plans at radically reduced levels all the way through 2025. Total has marginally raised its capital investment budget for this year, while BP and Shell have put a firm ceiling on expenditure.So while the combination of higher oil prices, rock-bottom spending and asset sales is delivering the surge in cash flow that will help solve the supermajors’ short-term problems, it may be creating a long-term headache. Shell acknowledged earlier this month that it’s not investing enough in new projects to offset the natural decline in production from its existing oil and gas fields.The majors are “slaking the shareholders’ thirst for cash returns,” said Russ Mould, investment director at AJ Bell. In the long term “capex cuts, debt and disposals could do as much if not more harm than good, and none are really sustainable.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Jack Ma’s Ant Group Co. plans to offer zero-interest loans to employees who own illiquid stock options, seeking to boost morale after the company’s landmark initial public offering was suspended in November, people familiar with the matter said.The loans will be backed by eligible employees’ restricted stock options, which will be valued at levels calculated after a 2018 funding round, the people said, asking not to be identified discussing private information. That will allow Ant to give staff access to liquidity without requiring the company to establish a more up-to-date valuation for its shares.The options, known as Share Economic Rights with each representing 5.53 shares, will be priced at 195 yuan ($30.05) or 35.26 yuan a share, in line with an internal buyback price from 2018, the people said. Ant was valued at $150 billion at the time.Ant’s executives are trying to halt a potential exodus of staff, who had expected a windfall with the company just days away from listing in Shanghai at a $280 billion valuation. Chairman Eric Jing assured employees in March that the firm would eventually go public and promised a “short-term liquidity solution” that would take effect this month.Details of the loan program will probably be announced in the next few days, the people said. Ant declined to comment via email.The company suspended its share buyback program for current and departing staff last year to prepare for its IPO. It needs to compete for talent with China’s other technology behemoths including Tencent Holdings Ltd. and e-commerce giant Meituan, which have seen their shares climb as Ant battles a regulatory overhang.The future of Jack Ma’s company -- and its valuation -- has been shrouded in uncertainty as regulators sort through details of a fintech industry overhaul that abruptly halted Ant’s $35 billion IPO in November. The company has since committed to drastically revamping its business and seen its chief executive officer Simon Hu exit.Early investor Warburg Pincus LLC marked down the valuation of the fintech giant to a range of $200 billion to $250 billion at year end, people familiar have said.That’s a drop from its peak valuation but better than the 60% decline projected by Bloomberg Intelligence analysts.Many of Ant’s employees have been granted restricted stock options, which account for a significant portion of total compensation for some employees. These are usually subject to a four-year vesting schedule, with 25% free from the lockup upon the first anniversary and 25% every year thereafter.Before Ant’s buyback program was halted, departing employees would sell shares back to the company at a valuation in line with the company’s most-recent funding round, while existing employees could participate in periodic buyback rounds, people familiar with the matter said.Outstanding SERs totaled 114 million at the end of June, according to the latest data disclosed by Ant. If valued at the company’s planned IPO price in November, they would have been worth a combined 43 billion yuan.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- South Korean energy supplier SK Innovation Co. and SK IE Technology Co. have raised 2.25 trillion won ($2 billion) in the battery material unit’s initial public offering, the country’s biggest in four years.SK IE Technology has priced the offering at 105,000 won per share, the top of a marketed range, according to an exchange statement on Monday. The portion for institutional investors was 1,883 times oversubscribed. At $2 billion, the IPO of the maker of battery separators will be South Korea’s largest since mobile game-maker Netmarble Corp. raised $2.4 billion in 2017, according to data compiled by Bloomberg.The shares had been marketed at 78,000 won to 105,000 won each, with SK Innovation selling 12.8 million shares and SK IE Technology selling another 8.6 million.SK IE Technology’s float comes as Korea is expected to see a record year for first-time share sales, with a number of billion-dollar-plus deals in the pipeline. Companies have already raised about $2.7 billion through IPOs in Korea since Jan. 1, more than half of the $5 billion that was fetched in all of 2020, data compiled by Bloomberg show.A boom in retail trading in the country last year contributed to a strong 2020 for Korean IPOs, with mom-and-pop buyers piling into deals such as the float by K-pop superstar boy band BTS’ agency. Analysts expect that enthusiasm to continue this year given the country’s loose monetary policy.Hit game developer Krafton Inc., LG Chem Ltd.’s battery business and KakaoBank Corp., Korea’s biggest mobile-only bank, are among the companies planning large offerings this year.Read more: This is Looking to Be a Record Year for Korea IPOs: ECM WatchSK Innovation, the energy and chemicals unit of South Korea’s third-largest conglomerate, SK Group, was a relative latecomer to the electric-car battery industry, embracing the technology only as part of a diversification push. It began developing lithium-ion batteries for hybrid electric vehicles in 2005 and spun off the unit in April 2019. Battery separators improve the output and stability of batteries.SK IE technology plans to use the IPO proceeds for capital expenditures related to capacity expansion in Poland and China, as well as for the upgrading and maintenance of its production facilities and equipment. The company announced last month it will spend 1.1 trillion won building new factories in Poland to meet growing demand amid an EV boom in Europe.SK IE Technology’s IPO is being managed by Mirae Asset Securities Co. and JPMorgan Chase & Co., assisted by Korea Investment & Securities Co. and Credit Suisse Group AG. Its shares are expected to start trading on May 11.(Updates the story throughout with exchange filing.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- China Three Gorges Renewables Group Co. is set for an initial public offering that could be the biggest in the country this year after securing regulatory approval.The unit of China Three Gorges Corp. plans to sell up to 8.57 billion shares in Shanghai, it said in a prospectus filed to the Shanghai stock exchange, without giving the value of the funds to be raised. The state-owned company has received written approval from China’s securities regulator, according to a China Securities and Regulatory Commission statement Friday.China Three Gorges Renewables announced last year it was seeking to raise 25 billion yuan ($3.85 billion) in an IPO. The listing could easily be the largest debut in China in 2021 if it starts trading this year, according to data compiled by Bloomberg, topping Tianneng Battery Group Co.’s $697 million listing in January.The parent is the world’s largest hydropower company and China’s largest clean-energy firm, according to the company website. Its renewables unit’s total assets -- mainly solar and wind farms, as well as small hydro power plants -- are valued at more than 140 billion yuan.The issuance of shares is scheduled to start May 10, and the company will use proceeds to fund offshore wind power projects and replenish liquidity, the statement said.The funds are mainly for projects targeted for this year, before China’s national offshore wind subsidy scheme is due to lapse, said BloombergNEF analyst Leo Wang. Provincial subsidies that have been announced so far aren’t nearly enough to make offshore wind projects profitable at current cost levels, he said.Still, the listing comes as China’s ambition for renewables has soared amid its aim to reach peak carbon emissions by 2030 and carbon-neutrality by 2060. Wind installations have doubled to a record in 2020, and solar installations are forecast to hit a record this year.Capitalizing on rising demand for clean energy, China Three Gorges Renewables in April alone announced two new solar projects. Its parent recently started filling the reservoir at its latest mega-hydropower project and signed a collaboration agreement with Xinjiang Goldwind Science & Technology Co., the world’s second-largest wind-turbine maker.“The proposed IPO is aligned with government policy directives to deleverage state-owned enterprises and increase mixed ownership in such entities,” Ada Li, a Moody’s Investors Service vice president, said in a report. The listing will also help to reduce the parent company’s debt, she said.Bloomberg reported in March that the parent company was in the midst of selling a stake in its international asset portfolio. Investors include Singapore’s sovereign wealth investor GIC Pte and Chinese state-backed fund CNIC Corp.(Adds analyst comment in sixth and ninth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Retail traders have shifted from "meme stocks" to large-cap names and exchange traded funds, and while their activity has eased from its January peak, the blistering pace of new retail account openings means non-professionals are likely to remain a market force. Retail trading levels skyrocketed at the beginning of the year, helped by the frenzy of buying in stocks like GameStop Corp. But that has been followed by a pullback, according to data, despite expectations that investors would use stimulus checks to trade. Liu said small investors who sold favorites like GameStop in February or March likely got burned, as most of the names retail piled into in January fell between 20% and 30%.
(Bloomberg) -- The most popular currency trade at the beginning of the year has splintered as Wall Street takes to opposing sides on the fate of the dollar in the world’s pandemic recovery.JPMorgan Asset Management and T. Rowe Price see the dollar weakening as U.S. economic exceptionalism wanes, while PineBridge Investments expects it to strengthen. Currencies from the euro to the Brazilian real -- which suffered in the first quarter -- have attempted rallies this month leaving the greenback sitting at a closely-watched technical crossroads.“You have that idiosyncratic U.S. rates outperformance story being offset by the global cyclical upswing and by expensive valuations on the dollar,” said Ian Samson, a multi-asset fund manager at Fidelity International in Hong Kong, who is long the currency against the euro. “We see significant crosswinds blowing the dollar in different directions.”While most on Wall Street called for a weaker dollar in January, the world’s reserve currency went on a run that left speculative funds scrambling to cover $30 billion of net short positions as Treasury yields climbed and expectations of rate hikes were brought forward. That trade soured this month, with the Bloomberg Dollar Spot Index slipping 2.3%. A break of the uptrend in place from its first quarter would point the way to further downside.This week’s policy assessment by the Federal Reserve, which has held firm against hawkish expectations, could lend weight to bears. At the crux of dollar forecasts is expectations for the pace of recovery in the world’s biggest economy.U.S. EdgeAs the world strives to break free from the bruising economic effect of coronavirus restrictions, the U.S. has inoculated more citizens than any other country, giving it an edge in the race to re-open. Coupled with the Biden administration’s multi-trillion dollar fiscal stimulus and a Fed that’s allowing inflation to overshoot, it’s spurring the likes of PineBridge Investments to predict more dollar gains.“U.S. Treasury yields could see another leg higher once we see some inflation come back,” with their premium over peers supporting the dollar, said Omar Slim, portfolio manager at PineBridge in Singapore. “Our view is that the dollar will retain a strengthening bias this year.”Ten-year U.S. yields surged more than 80 basis points this year to 1.77% in March, the highest since before the pandemic. While the benchmark stood at 1.58% Monday, it remains well above this year’s low of around 0.90%.“Positive U.S. data might very easily kick-start a dollar rally again,” wrote Commerzbank AG currency strategist Thu Lan Nguyen in a note last week. “So for now U.S. dollar bears should make sure that they don’t get excited too soon.”Catching UpBut not everyone is convinced the U.S. will continue outpacing peers.For JPMorgan Asset’s Thushka Maharaj, its exceptionalism is set to fade as other nations catch-up on vaccine roll-outs and economic re-openings in the second half of the year.The London-based strategist is keeping tabs on developed markets like Europe, the U.K. and Japan, and sees the euro outperforming the dollar in the medium term. “We are expecting the rebound in these economies to mirror what we are seeing in the U.S. right now,” she said.Signs abound this trend is underway.Coronaviruses cases are rising in all regions except Europe, the World Health Organization said on Tuesday. The European Union is unleashing a new immunization drive to cover the bulk of its population within a few months, while on the economic front, recent PMI data have beaten expectations.The euro has climbed about 3% from a four-month low in March, and broke through the key $1.20 level last week.Some favor other currencies to best the greenback. T. Rowe’s Thomas Poullaouec sees more gains for Australia’s risk-sensitive dollar as China’s economy rebounds from the pandemic and demand for commodities rise.Aberdeen Standard Investments’ Edwin Gutierrez is watching for opportunities to boost exposure to riskier developing currencies as “the rest of the world catches up on the vaccine roll-out.”The Brazilian real, Indian rupee and Colombian peso -- which have been pummeled as the coronavirus raged across those countries -- stand out for the head of emerging-market sovereign debt in London.Substantially OvervaluedIn the meantime, vocal bears continue to warn about long-term headwinds for the dollar.“Beyond the near term, we continue to see a structurally negative outlook for the U.S. currency,” wrote Goldman Sachs Group Inc. strategists including Zach Pandl in a note Tuesday. “The dollar is still substantially overvalued.”(Updates with technical detail and prices in fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Blackstone Group Inc. has offered to buy a controlling stake in Indian IT outsourcing services provider Mphasis Ltd. for as much as 82.6 billion rupees ($1.1 billion) as demand for cloud computing surges amid the pandemic.Funds managed by the private equity firm have teamed up with long-term investors including Abu Dhabi Investment Authority and UC Investments to take a majority stake in Mphasis, the private equity firm said in a statement on Monday. That agreement triggered an open offer for an additional 26% stake in the Indian firm at 1,677.16 rupees apiece, or a 1.1% discount to the closing share price on Friday. The stock gained as much as 6.5% in Mumbai after the offer.Blackstone’s move to increase its stake in Mphasis is in sync with the U.S. asset manager’s plans to boost investment in the South Asian nation. India is the strongest performer in the world for Blackstone and the firm intends to continue deploying large investments in the nation, Blackstone Chief Executive Officer and co-founder Stephen Schwarzman said during his visit to Mumbai in 2020.“This investment enables us to continue creating value for the long term and provide additional resources to further accelerate the company’s growth momentum,” Amit Dixit, head of India for Blackstone private equity, said in the statement. Mphasis specializes in providing cloud and digital solutions and serves 35 of the top 50 U.S. banking, financial services and insurance firms, according to the statement.The open offer was triggered after Blackstone Capital Partners VI fund agreed to sell its 55.31% stake in Mphasis to an entity under Blackstone Capital Partners VIII and Blackstone Capital Partners Asia funds, according to a stock exchange filing. Blackstone is committing up to $2.8 billion for the controlling stake, according to the firm’s statement.Following the completion of the transactions, Blackstone is aiming to build MPhasis into a company worth $10 billion over the next four years, more than double its current valuation of about $4.4 billion, according to a person familiar with the matter, who asked not to be identified discussing internal targets. A representative for Blackstone declined to comment.Blackstone had purchased a majority stake in Mphasis in 2016 from Hewlett Packard Enterprise Co., paying 430 rupees per share at the time.(Updates with details about Blackstone’s plans for Mphasis in sixth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Oman is considering the sale of its stake in Oman Cement Co. SAOG, according to people with knowledge of the matter, as Gulf nations increasingly lean on state assets to bolster their finances.The sultanate is speaking to advisers about selling its nearly 54% holding in the company, according to the people, who asked not to be identified because the information is private. The stake could be worth just over $100 million based on its current market price.No final decisions have been made and the state may also decide to retain the stake.Oman Cement’s chief executive officer, Salem AlHajry, said there’s no plan for now to divest shares in the company and the government’s focus is on growing the business. The Oman Investment Authority, the country’s wealth fund that controls the stake, couldn’t be reached immediately for comment.The government has been seeking ways to tame its budget deficit and steady an economy hit by last year’s decline in oil prices and the coronavirus pandemic. It’s pushed through reforms including cutting spending, slashing government jobs and introducing a value-added tax in April.Oman is among Gulf monarchies that are now exploring new financing sources. Saudi Arabia is hoping to speed up privatizations and is following a model implemented by neighboring Abu Dhabi by selling assets of its main state-owned energy explorer.Cement CompetitionOver the last decade, Oman Cement has been facing intense competition from producers of the building material from the United Arab Emirates.Competitive pricing, coupled with increased operating expenses in the form of higher energy costs, has weighed on the business while construction activity has slowed. Oman Cement has lost around half its market value in the past five years, according to data compiled by Bloomberg.Oman is the largest Middle Eastern crude exporter outside of OPEC, pumping around 700,000 barrels a day. The country is also studying options for state energy company OQ SAOC, including a potential initial public offering.In December 2019, State Grid Corp. of China agreed to buy 49% of Oman Electricity Transmission Co. SAOC in a deal that was said at the time to value the firm at about $2 billion. The sale marked the first major privatization by Oman.The government has raised additional funding from the ownership transfer of some gas pipelines to Oman Gas Co.(Updates with CEO’s comment in fourth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Yahoo Finance