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TFFP earnings call for the period ending December 31, 2020.
(Bloomberg) -- AT&T Inc. was once the poster child for firms willing to sacrifice their credit ratings for the sake of debt-fueled acquisitions. Now, the company is making its biggest push yet to cut debt and ditch its long-held status as the world’s largest borrower.The telecom giant will reduce net debt by $43 billion as a part of a plan to spin off its media operations in a deal with Discovery Inc., according to an investor presentation accompanying the announcement. If its gross debt of $190 billion declines by roughly the same amount, AT&T would drop behind Verizon Communications Inc. in the rankings of the most indebted non-financial companies globally, according to data compiled by Bloomberg.AT&T has been on a yearslong effort to tame a debt load that once swelled to about $200 billion, largely accumulated via its 2018 acquisition of Time Warner Inc. With the Discovery transaction, AT&T will reach its goal of reducing leverage to 2.5 times a year ahead of schedule, and possibly spare bondholders from any potential ratings action that would push it closer to speculative grade.“This is a big step forward to reaching that leverage goal,” said Bloomberg Intelligence analyst Stephen Flynn. “Debt reduction should be the No. 1 priority.”AT&T’s bonds were among the best performers in the U.S. investment-grade market Monday. The most actively-traded securities, the 3.5% bonds due 2053, tightened 11 basis points, the most since November, according to Trace. The annual cost to protect AT&T’s debt against default for five years dropped the most since February.AT&T has chipped away at its debt load and streamlined its business through a series of refinancings, exchange offers and asset sales in recent years. Yet it recently deviated from its debt diet when it pledged to spend up to $23 billion on spectrum to expand its 5G network, a move largely financed by bonds and loans.That drew a downgrade from Fitch Ratings and a negative outlook from S&P Global Ratings in March. Verizon, which borrowed $25 billion in the year’s largest bond sale to help fund its own spectrum purchases, saw its positive outlook changed to stable by Moody’s Investors Service.U.S.Square Inc. is looking to raise $2 billion from a debut junk-bond sale, one of the largest inaugural new issues of the year, according to data compiled by Bloomberg. Eight other deals kicked off marketing Monday.High-grade issuance is set to remain strong and steady this week, with $30 billion to $35 billion of fresh supply expected following a $42 billion week headlined by Amazon.com Inc.’s jumbo saleRally-weary U.S. junk bonds posted the biggest loss in two months last week. Still, investor demand remained robust, with more than $13 billion of deals pricedBank of America expects U.S. investment-grade corporate debt spreads to widen “in coming months” as Treasury yields push higherFor deal updates, click here for the New Issue MonitorFor more, click here for the Credit Daybook AmericasEuropePrimary market participants expect the SSA sector to maintain its dominance of weekly activity, according to a survey conducted by Bloomberg News on May 14. Public-sector borrowers have led sales for 16 out of 19 weeks this year, according to data compiled and analyzed by Bloomberg.Some 16 mandates hit screens, including an inaugural green bond from Air LiquideOther borrowers planning sales include engineering and technology company Technip Energies, which will hold investor calls on Monday and Tuesday ahead of an inaugural euro seven-year saleCovered bond supply is set to get a boost from Raiffeisen-Landesbank Steiermark and United Overseas Bank, while Spanish lender Cajamar is planning a Tier 2AsiaIndian dollar bonds have been rebounding in recent weeks on bargain hunting after the Covid-19 crisis left them among Asia’s worst performers at times last month.Spreads on investment-grade Asian dollar bonds narrowed 2-3 basis points on Monday, according to tradersThere was mix of investment-grade and high-yield bond deals in the primary market on Monday, including HSBC Holdings Plc and National Australia Bank Ltd.China Huarong Asset Management Co. has reached funding agreements with state-owned banks to ensure it can repay debt through at least the end of August, by which time the company aims to have completed its 2020 financial statements, people familiar with the matter saidMore stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- The European Union’s final bond sales for its regional jobs program failed to live up to the hype of previous editions, a concerning sign for its landmark borrowing spree that’s due to start in the second half of the year.Investors placed 88.7 billion euros ($108 billion) of orders for eight- and 25-year securities tied to the SURE social program, little more than a third of the record set for a dual-tranche issue last year. It comes as yields across the region climb as investors prepare for European Central Bank to scale back its bond purchases in the face of growing inflationary pressures. The bloc is ready to start sales for its 800 billion-euro recovery fund by July.It marks a stark turnaround for one of the hottest new triple-A rated bond markets in town. When the EU launched the securities last year, Europe was still firmly in the throes of lockdowns, the ECB was committed to pumping money into debt markets and investor demand for the securities was enormous. Now, with economies reopening and consumer prices expected to accelerate, they’re becoming a less attractive asset.“We had been used to some very strong demand for the EU bonds,” said Jens Peter Sorensen, chief analyst at Danske Bank AS. “Why buy today, if you can buy cheaper tomorrow? That’s becoming a self-fulfilling prophecy.”The bloc is set to become a major issuer of bonds in the coming years, potentially creating a debt market akin to the size of Spain’s. The securities have also been touted as a one-day rival to U.S. Treasuries, given the current scarcity of German bonds -- the region’s haven asset -- and the risks associated with holding riskier peripheral debt.In another sign of waning demand, the yield on 10-year SURE bonds has climbed more than 40 basis points since they were issued in October. That mirrors moves elsewhere in Europe, with German 10-year bond yields climbing to their highest level since 2019 last week.Goldman Sachs Group Inc. expects them to breach 0% for the first time since 2019 this year. Italian 10-year bond yields rose to the highest level since July on Monday as investors speculated an economic growth rebound could mean less central bank support.“The first few EU SURE syndications were a smashing success in terms of demand,” said Martin van Vliet, a strategist at Robeco. “There will be structural demand for triple AAA paper such as the EU, so the recovery fund issuance will be digested, but we’re not sure demand will be as astronomical.”The Commission announced Monday that it would use an auction system operated by France’s central bank to issue debt later in the year, relying on syndications in the meantime. Sales are expected to average around 150 billion euros per year for the duration of the program, though all member states need to ratify the recovery program for funds to start flowing.Still, EU bonds will outperform “core” European sovereign peers because investors face a serious shortage of notes in both the short- and long-term, Commerzbank AG analysts wrote in a note to clients last month. Any attempt to extend the size of the package is likely to be politically difficult, they argue.The EU mandated Deutsche Bank AG, LBBW, Morgan Stanley, Natixis SA and NatWest Markets for the sale of SURE bonds. Commerzbank expects the EU will sell as much as 15 billion euros of bonds. The sale of eight-year securities was given a price of two basis points below midswaps, while the 25-year was marked at 17 basis points above.“Over the last couple of weeks things have definitely turned more challenging,” said Christoph Rieger, head of fixed-rate strategy at Commerzbank. “Lower ECB buying may require somewhat higher premiums.”(Updates to include final demand from first paragraph.)More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Germany's financial regulator BaFin on Tuesday vowed to look more closely at the business models of the companies it oversees in the wake of collapse of Wirecard and Greensill Bank over the past year. BaFin has drawn severe criticism for failing to identify problems at the payments company and the bank, two scandals that rocked the reputation of corporate Germany. "We need to take a closer look at the business models of the institutions and look more closely look behind their facade," said Raimund Roeseler, who oversees the banking industry at BaFin.
(Bloomberg) -- Amazon.com Inc. is in talks to buy James Bond movie company Metro-Goldwyn-Mayer, according to a person familiar with the matter, potentially taking one of the last major independent film studios off the market.Amazon is considering a bid of about $9 billion, said the person, who asked not to be identified because the deliberations are private. Discussions could still fall apart and details such as price may change, the person said. The Information and Variety previously reported on the talks.An agreement would cap a rush of streaming deals that are set to make 2021 a record year for media takeovers. Reports about the discussions came on the day that AT&T Inc. announced its plan to create a new entertainment company by merging assets with Discovery Inc. in an entity that will be valued at about $130 billion including debt.The proliferation of streaming services, including newer arrivals such as Disney+, HBO Max and Paramount+, has put pressure on Amazon to acquire more programming. MGM’s vast backlog also provides plenty of material at a time when production of new shows and movies is still recovering from the pandemic.MGM and Amazon declined to comment on deal talks.More than $80 billion in media takeovers have been announced so far this year, according to data collected by Bloomberg. That puts 2021 on track to be the busiest period for the industry since at least 2000, when AOL and Time Warner Inc. announced plans to combine.MGM has been seen as a takeover target for years, but was never able to close a sale. The company made a fresh push last year, when the Wall Street Journal reported it hired advisers to solicit offers.How the Pandemic Pressed Fast Forward on the Streaming Wars: QuickTakeMGM also discussed other scenarios with tech giants. MGM, whose library includes the “Rocky” films and “Silence of the Lambs,” held talks with Apple Inc. and Netflix Inc. about taking its new James Bond film directly to streaming. But the company said last year that it’s committed to a theatrical release for the film, which is currently slated for Oct. 8 in the U.S.Amazon, meanwhile, is reshuffling its entertainment operations with the return of longtime executive Jeff Blackburn. He briefly left the e-commerce company to join Silicon Valley venture capital firm Bessemer Venture Partners. But now he’s taking command of Amazon’s entire entertainment division, including the Prime Video streaming service, Amazon Studios and the video-game-streaming site Twitch.An Amazon acquisition of MGM would be its largest purchase since it bought Whole Foods Market for $13.7 billion in 2017.Talking to ChairmanAmazon’s bid for MGM is being handled by video executive Mike Hopkins, according to Variety. He’s dealing directly with MGM Chairman Kevin Ulrich, the publication said.MGM traces its roots back to the 1920s merger of Marcus Loew’s Metro films with a film company run by Hollywood legend Louis B. Mayer. While making great pictures like “Dr. Zhivago” and “2001: A Space Odyssey,” MGM drifted in and out of financial distress in the second half of the 20th century. Over the decades it was owned by Time Inc., CNN founder Ted Turner and more than once by the late billionaire Kirk Kerkorian.Now, it’s one of the last large movie studios that’s maintained its independence from larger media groups. Warner Bros. is now part of AT&T, Walt Disney Co. acquired 20th Century Fox, Paramount is owned by ViacomCBS Inc., and Universal Pictures is controlled by Comcast Corp.There’s been speculation before about Amazon acquiring entertainment companies. It was previously seen as a possible buyer of AMC Entertainment Holdings Inc., the movie chain, with some investors confusing it with AMC Networks Inc., the owner of cable channels.Investors suffered a similar sort of confusion on Monday, with the Information report boosting shares of MGM Resorts International, a casino company that isn’t part of Metro-Goldwyn-Mayer. MGM Resorts stock jumped as much as 5.8% in late trading before quickly retreating.More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Baidu Inc., the Chinese search giant that’s shifting into artificial intelligence, reported quarterly revenue that beat analysts estimates, extending its recovery from the Covid-19 pandemic.Revenue climbed 25% to 28.1 billion yuan ($4.4 billion) in the three months ended March, compared with the average 27.3 billion yuan of estimates. Net income surged to 25.7 billion yuan, mostly boosted by gains in the value of long-term investments, including in recently listed Kuaishou Technology.The company predicted sales of 29.7 billion yuan to 32.5 billion yuan for the June quarter, versus the 30.2 billion yuan seen by analysts.Founder Robin Li has in recent years sought to pivot Baidu away from search to reposition itself as an AI company with autonomous driving ambitions. The firm will eventually derive the bulk of its revenue from businesses beyond search and advertising, as it sustains record R&D investment into AI technologies, the 52-year-old chief executive officer said in an interview with Bloomberg Television in March.What Bloomberg Intelligence Says:Baidu’s sales mix is likely to shift further away from its traditional search advertising business as growth at its non-marketing initiatives continues to be much stronger. Cloud services, autonomous driving, smart transport and hardware drove a 52% jump in 4Q non-marketing sales, while core ads stayed flat for the second consecutive quarter. The trend may accelerate with the integration of Joyy’s domestic live-streaming business in 1H. Operating margin may plunge sequentially due to weak seasonality and stepped-up investment in new initiatives.-- Vey-Sern Ling and Tiffany Tam, analystsClick here for the researchBaidu climbed almost 4% in pre-market trading in New York. The stock has plunged roughly 44% from its record in early February after it was caught up in the implosion of Bill Hwang’s Archegos Capital Management that led to a forced liquidation of the fund’s positions, including in Baidu. Its Hong Kong-listed shares are down nearly 26% since they began trading in March, the worst performer among recent major Chinese tech listings in the city. In contrast, Bilibili Inc., which made its Hong Kong debut about a week after Baidu, has declined 3% while Kuaishou has almost doubled since its February debut.Once part of China’s internet triumvirate alongside Alibaba Group Holding Ltd. and Tencent Holdings Ltd., Baidu has fallen behind in the mobile era, where the effectiveness of its search service has been crippled by super-apps like WeChat creating siloed ecosystems.To compete, Baidu’s core search product is morphing into an all-purpose platform hosting an array of content from news articles to live-streams and short videos, essentially emulating those apps. It last year agreed to pay $3.6 billion in cash for Joyy Inc.’s livestreaming video business in China is aimed at regaining lost ground to the likes of TikTok owner ByteDance Ltd.Its Netflix-style unit iQiyi Inc. reported first-quarter revenue of 7.97 billion yuan, topping the 7.67 billion yuan average of estimates, after drawing more users. Sales in the three months ending in June will be between 7.21 billion yuan to 7.65 billion yuan, compared with an estimated 7.52 billion yuan. The stock rose more than 5% in pre-market trading.It’s also making a big push into autonomous driving, betting on the smart vehicles of the future. In January, the company announced it’s teaming up with Zhejiang Geely Holding Group to produce smart electric vehicles, prompting analysts to hike their value estimates for Baidu’s self-driving unit Apollo. The venture, Jidu Auto, aims to spend 50 billion yuan over the next five years to develop smart-car technology and will hire as many as 3,000 employees for the project over the next two to three years, the company said last month.Read more: Baidu and Geely Plan $7.7 Billion Smart Car Push(Updates with iQiyi shares in ninth paragraph)More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- AT&T Inc. agreed to spin off its media operations in a deal with Discovery Inc. that will create a new entertainment company, merging assets ranging from CNN and HBO to HGTV and the Food Network.The transaction values the combined entity at about $130 billion including debt, based on WarnerMedia’s estimated enterprise value of more than $90 billion.AT&T will receive $43 billion in cash, debt securities and debt retention, with its shareholders getting stock representing 71% of the new company, the companies said in a statement Monday. The deal is structured as a tax-friendly Reverse Morris Trust.The plan, first reported by Bloomberg News, would combine Discovery’s reality-TV empire with AT&T’s vast media holdings, creating a formidable competitor to Netflix Inc. and Walt Disney Co. It marks a retreat for AT&T’s entertainment-industry ambitions after years of working to assemble telecom and media assets under one roof. AT&T, now the world’s most heavily indebted nonfinancial company, gained some of the biggest brands in entertainment through its $85 billion acquisition of Time Warner Inc., completed in 2018.Discovery Chief Executive Officer David Zaslav is to lead the new entity. The future of WarnerMedia CEO Jason Kilar, meanwhile, has yet to be determined, AT&T CEO John Stankey said on a conference call discussing the deal.The transaction includes all of AT&T’s WarnerMedia operations. In addition to CNN and HBO, WarnerMedia owns Cartoon Network, TBS, TNT and the Warner Bros. studio. Discovery, backed by cable mogul John Malone, controls networks such as TLC and Animal Planet. The new company’s name will be announced this week, Zaslav said on the conference call.‘Complementary Content’“This agreement unites two entertainment leaders with complementary content strengths and positions the new company to be one of the leading global direct-to-consumer streaming platforms,” Stankey said in the statement. “It will support the fantastic growth and international launch of HBO Max with Discovery’s global footprint and create efficiencies which can be reinvested in producing more great content to give consumers what they want.”Discovery shares initially jumped on news of the deal, but they began to slip later Monday and were down as much as 4.5% to $34.05. AT&T climbed 1% to $32.56 as of 12:30 p.m. in New York.In shedding the assets, Stankey has been unwinding an acquisition spree undertaken by predecessor Randall Stephenson. The deal underscores the difficulty telecom companies have had finding a payoff from their media operations. Verizon Communications Inc. announced its own plan to slim down earlier this month. The company agreed to sell its media division to Apollo Global Management Inc. for $5 billion, a move that will offload online brands like AOL and Yahoo.“I expect AT&T is going to be the No. 1 telecom and communications company in the world,” Zaslav said on the conference call. And the new combined entity “will not stop until we have the No. 1 global entertainment company, reaching people on every device.”Though he has questioned in the past whether news content was a good fit with Discovery, Zaslav said the new company would keep CNN and “lean into news.”Kilar, a streaming-industry veteran who helped found Hulu, has been running WarnerMedia for the past year. At a recent investor conference, he defended the need for the business to be owned by AT&T, saying the telecom company had invested billions of dollars in HBO Max and broken down silos within the company to create a single operating unit. He added that AT&T’s phone and broadband customers were less likely to cancel if they got HBO Max, and many of HBO Max’s subscribers were AT&T customers.At Discovery, Zaslav has helped the company grow through acquisitions, including a purchase of HGTV owner Scripps Networks Interactive Inc. in 2018.Discovery’s RallyDiscovery shares experienced a meteoric rally earlier this year but had lost more than half their value since Bill Hwang’s Archegos Capital Management was forced to liquidate its positions. The shares remained up 18% for the year through the end of last week. That gave the company a market value of almost $24 billion. AT&T, meanwhile, gained 12% in 2021, giving it a market capitalization of $230 billion.LionTree LLC and Goldman Sachs Group Inc. advised AT&T on the transaction, while Allen & Co. and JPMorgan Chase & Co. worked with Discovery. Perella Weinberg Partners also provided advice to Discovery’s independent directors.Stankey has been cleaning house at the sprawling telecom titan, cutting staff and selling underperforming assets. The company has been funneling money into rolling out its 5G wireless network, which requires billions of dollars of investment, as well as expanding its fiber-optic footprint.What Bloomberg Intelligence Says“We believe Comcast could add its NBC unit to the bidding mix. An NBC-Warner matchup would combine two powerful studios and streaming platforms while a scaled TV network unit with $12 billion in Ebitda could better weather secular declines and generate $2 billion in cost savings.”--Geetha Ranganathan, media analystClick here to read the research.The carrier has been boosting movie and television production to attract subscribers to its HBO Max streaming service. It also needs cash to pay down debt. AT&T racked up borrowing of $200 billion after an acquisition spree, and though it’s been reducing what it owes, it now has bills from a recent spectrum auction.AT&T was the second-highest bidder in the Federal Communications Commission’s sale of airwaves, committing $23 billion. Verizon, the top bidder, agreed to pay $45 billion.DirecTV SpinoffThe Discovery agreement comes just months after AT&T reached a deal to spin off its DirecTV operations in a pact with buyout firm TPG. AT&T also agreed in December to sell its anime video unit Crunchyroll to a unit of Sony Corp. for $1.2 billion.And the company has parted with its Puerto Rico phone operations, a stake in Hulu, a central European media group and almost all its offices at New York’s Hudson Yards.Stephenson had spent his 13-year tenure as CEO bulking up the company. Stephenson, who handed the reins to Stankey last year, even kept a color-coded roster of companies he wanted AT&T to buy, leading to 43 acquisitions.But critics such as activist investor Elliott Management Corp. complained about the strategy, urging AT&T to focus on its core business. AT&T’s mountain of debt also put pressure on the company to cut staff and sell assets.‘Transformational Year’The Discovery deal represents an admission that AT&T’s audacious plan to build a media and communications conglomerate was a costly misfire.Elliott weighed in on the news Monday morning, praising Stankey’s efforts to redirect the Dallas-based phone company.”It has been a transformational year at AT&T,” Jesse Cohn, managing partner, and Marc Steinberg, portfolio manager, said in a statement. “AT&T has now executed on its promise to streamline operations and refocus on its core businesses.”Analysts see antitrust risk to the Discovery tie-up as low. By creating a large collection of cable channels, one question for competition authorities is whether the combined company would have increased leverage over pay-TV distributors that could lead to higher prices for consumers.But the Department of Justice in 2018 approved a much larger media merger with Disney’s purchase of film and TV assets held by 21st Century Fox.Economic Harm“If the DOJ did not think that combining those cable assets caused market harm, it is a little difficult to see the kind of economic harm that a smaller combination could cause, particularly as the economic power of cable assets is diminishing as the power of streaming assets grows,” Blair Levin, an analyst at New Street Research, said in a note Monday.The Discovery deal also unwinds the AT&T-Time Warner combination that the Justice Department argued was illegal, a challenge that ultimately failed.Since then, consumers’ streaming options have proliferated, which will ease the path to approval, according to Bloomberg Intelligence analyst Jennifer Rie. She expects a review that could last up to a year and may require the new company to sell some assets or agree to arbitration provisions if there are disagreements with cable companies over distribution deals.“That result is far more likely than the DOJ trying to go to trial again after the loss the first time,” she said.(Updates with shares in eighth paragraph, Elliott comments in 24th paragraph.)More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
“Widespread adoption of CBDCs may be disruptive for financial systems if associated risks are not managed,” warn Fitch Ratings analysts.
Andrea Orcel has lowered his compensation claim against Santander over a rescinded offer to make him chief executive to slightly more than 45 million euros ($55 million), a source with knowledge of the matter said on Tuesday. The Italian banker has dropped a part of his legal claim that would require the Spanish bank to hire him because he has since been appointed as CEO of Italy's UniCredit, the source, who declined to be named as the person is not permitted to speak on behalf of Orcel, told Reuters. Orcel, who quit as the top investment banker at Swiss bank UBS in 2018 to join Santander, was seeking as much as 112 million euros for breach of contract and the damage to his career from the Spanish bank's last minute U-turn.
(Bloomberg) -- China’s central bank injected medium-term cash into the financial system, in an effort to keep borrowing costs stable as China’s economy continues its recovery from the virus pandemic.The People’s Bank of China added 100 billion yuan ($15.5 billion) of one-year funds with its medium-term lending facility on Monday, matching the amount coming due in a move that was expected by analysts. The authorities kept the interest rate unchanged at 2.95%.By rolling over the maturing funds, the operation is also seen to be supportive of the nation’s liquidity-sensitive stocks and also bonds. The cost on China’s 10-year note was little changed Monday. In the money market, the seven-day repurchase rate rose 19 basis points to 2.19%, near its daily average level over the past year. It recently hit a four-month low.The benchmark CSI 300 Index rose 1.5%. Data showed China’s economic activity moderated in April from its record expansion in the first quarter. That eased concerns about further tightening of fiscal and monetary policies, according to Zhang Gang, a strategist with Central China Securities Co. The nation’s top leaders recently described the recovery as “unbalanced and unstable,” pledging further efforts to drive a rebound in domestic demand.China’s sovereign notes gained for three weeks in a row as of Friday, the longest run since January. That’s even as Treasury yields have climbed and a surprisingly quick jump in the nation’s factory-gate prices were seen to pose a challenge to current monetary policy. Factors behind the resilience include ample liquidity and capital inflows, which accelerated in April. While the loose conditions could be tested by a rise in debt sales in May, the PBOC’s vow to keep cash supply ample has boosted confidence.“The PBOC will stay supportive of liquidity to ensure the supply of local government bonds can be readily absorbed, when inflation does not appear to be a major concern for the central bank,” said Frances Cheung, a rates strategist at Oversea-Chinese Banking Corp. Beijing will step up injecting short-term cash soon, she added. “With the expected pick-up in issuance of bonds, chance is for some net injections as and when are needed.”The PBOC has done the minimum in its daily operations to manage short-term liquidity over the past two months. It has been injecting 10 billion yuan of cash daily-- no matter the size of funds coming due -- since the start of March. That’s a sign the central bank is so far pleased with the subdued volatility in the money market.(Updates market moves in third and fourth paragraphs.)More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
SafeMoon debuted its cryptocurrency in March, claiming to solve common problems that plague Bitcoin, Ethereum, and Dogecoin.
‘Will she still be able to use our daughter as a tax deduction? My concern is also with the coming child tax credit this summer.’
AT&T's stock is the biggest loser in the S&P 500 on Tuesday. Its valuation depends on how much credit investors give the combined WarnerMedia/Discovery for its future streaming efforts.
(Bloomberg) -- U.S. technology stocks rose on Tuesday as optimism that economic reopenings will boost growth outweighed concern about a pickup in virus cases in parts of Asia. Oil prices dropped amid a report that significant progress has been made to revive the U.S.-Iran nuclear deal.The Nasdaq 100 Index climbed for the third time in four sessions, boosted by gains in Tesla Inc., Amazon.com Inc. and Microsoft Corp. The S&P 500 fluctuated between gains and losses. AT&T Inc. plunged the most in the benchmark gauge after the company said it plans to spin off its media operations. Walmart Inc. rallied the most in six weeks after boosting its profit outlook.Stocks have been volatile after touching a record in early May as investors assessed economic growth prospects against a Covid-19 resurgence in countries including India. Minutes from the latest Federal Reserve meeting, due Wednesday, may offer clues on inflation pressure and hints of a timeline for tapering stimulus. Fed Vice Chair Richard Clarida said Monday that the weak U.S. jobs report showed the economy had not yet reached the threshold to warrant scaling back asset purchases.“What appeals to me is that investors are acting like investors again,” Abby Joseph Cohen, senior investment strategist at Goldman Sachs Group Inc., said in an interview on Bloomberg TV. “There is less emphasis on momentum and there’s more emphasis on relative valuation and which of the companies that have the strongest cash flow growth and are investing that cash flow growth.”Global investor sentiment is “unambiguously bullish,” Bank of America Corp. strategists led by Michael Hartnett said, citing the firm’s latest fund manager survey. Inflation topped the list of the biggest tail risks, followed by a bond market taper tantrum and asset bubbles, while Covid-19 was only in fourth place.West Texas Intermediate crude extended declines after the BBC Persian news channel, citing Russian diplomat Mikhail Ulyanov, reported that a major announcement may be made on Wednesday regarding talks to broker an agreement between Iran and the U.S. and revive the 2015 nuclear deal. Ulyanov said on Twitter that “unresolved issues still remain and the negotiators need more time and efforts to finalise an agreement on restoration” of the accord.Elsewhere, Bitcoin fell to the lowest since February after the People’s Bank of China reiterated that the digital tokens cannot be used as a form of payment. Coinbase Global Inc. fell after Monday’s drop below the reference price used in its April direct listing.Here are some key events this week:The Fed publishes minutes from its April meeting Wednesday, which may provide clues to officials’ views on the recovery and how they define “transitory” when it comes to inflationEIA crude oil inventory report WednesdaySt. Louis Fed President James Bullard and Atlanta Fed President Raphael Bostic to speak at separate events WednesdayIMF Managing Director Kristalina Georgieva and ECB President Christine Lagarde speak at the Vienna Economic Dialogue ThursdayAustralia unemployment rate ThursdayEuro-area finance ministers and central bank chiefs hold an informal meeting. A larger group of EU finance ministers and central bank chiefs will meet May 22These are some of the main moves in markets:StocksThe S&P 500 was little changed as of 1:34 p.m. New York timeThe Nasdaq 100 rose 0.5%The Dow Jones Industrial Average fell 0.1%The MSCI World index rose 0.5%CurrenciesThe Bloomberg Dollar Spot Index fell 0.3%The euro rose 0.5% to $1.2216The British pound rose 0.4% to $1.4191The Japanese yen rose 0.2% to 108.95 per dollarBondsThe yield on 10-year Treasuries was little changed at 1.65%Germany’s 10-year yield advanced one basis point to -0.10%Britain’s 10-year yield was little changed at 0.87%CommoditiesWest Texas Intermediate crude fell 1.4% to $65 a barrelGold futures were little changedMore stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Experienced hands look to be buying the dip as a key bitcoin price indicator suggests the pullback may be coming to an end.
A paper that my colleague Anqi Chen and I wrote last year — “How Much Taxes Will Retirees Owe on Their Retirement Income?” — keeps hitting the “top 10” list on a major listserv for social sciences research. As people approach retirement, they tend to add up their financial resources — Social Security benefits, defined benefit pensions, defined contribution balances, and other assets. The question we look at is just how large the tax burden is for the typical retired household and for households at different income levels.
Raoul Pal tells bitcoin investors that current volatility is to be expected, but big things are around the corner.
S&P Dow Jones Indices will pay a $9 million fine to settle U.S. Securities and Exchange Commission charges that its negligence in managing one of its indexes caused huge losses for securities issued by Credit Suisse Group AG during extreme market volatility. The SEC said S&P DJI should have disclosed that its S&P 500 VIX Short Term Futures Index ER contained an "auto hold" feature that caused its value to remain static for more than an hour on Feb. 5, 2018, even as the underlying CBOE Volatility Index ("VIX") was spiking 115% higher. According to the SEC, the stale data contributed to a 96% drop in the value of the Credit Suisse's VelocityShares Daily Inverse VIX Short-Term Exchange-Traded Notes ("XIV Notes"), whose value was dependent on the S&P DJI index.
‘Everybody wants to have asset prices forever going up and the cost of financing to be next to nothing,' Kerry Killinger says.
GameStop and AMC overcame rocky starts to the trading day as comments on social media surged and retail traders mused once again about “squeeze"s on both stocks.
The payments will reach more than 65 million children, according to senior administration officials.