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Morning Brief: WPP CEO exit may lead to ad giant’s breakup

Monday, April 16, 2018

What to watch today

In the week ahead, earnings season will begin to ramp up with Goldman Sachs (GS), United Airlines (UAL), Johnson & Johnson (JNJ), IBM (IBM), Bank of America (BAC), Morgan Stanley (MS), American Express (AXP), Procter & Gamble (PG), and General Electric (GE) among the S&P 500 members set to report results.

The economic data calendar will be relatively tame, though Monday’s report on retail sales for the month of March will be closely watched.

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Top news

WPP CEO departure may herald breakup, strategy shift at empire: Martin Sorrell’s abrupt exit from WPP Plc (WPP) leaves the advertising empire in search of a new chief executive officer for the first time and vulnerable to a break-up, as the sprawling network of agencies faces its biggest challenges since the global financial crisis. Sorrell’s departure late Saturday from the world’s largest ad company puts WPP’s omissions in grooming a successor to its 73-year-old founder into sharp focus, even with shareholders long flagging the issue. It also raises the prospect of a split, as WPP loses the man holding the empire together. [Bloomberg]

Shire sells cancer drugs to Servier for $2.4B: Shire, the London-listed rare diseases specialist that is a potential takeover target for Japan’s Takeda Pharmaceutical, is selling its oncology business to unlisted French drugmaker Servier for $2.4 billion. The deal suggests there is value locked up within Shire’s portfolio — despite a dismal share price performance in the past two years — as its management braces for a possible $50-billion bid battle with Japan’s biggest drugmaker. [Reuters]

Question of sales tax on online purchases goes to high court: Online shoppers have gotten used to seeing $0 sales tax on checkout screens before they click “purchase.” But a case before the Supreme Court could change that. At issue is a rule stemming from two, decades-old Supreme Court cases: If a business is shipping to a state where it doesn’t have an office, warehouse or other physical presence, it doesn’t have to collect the state’s sales tax. More than 40 states are asking the Supreme Court to reconsider that rule in a case being argued Tuesday. [AP]

Guggenheim says it is cooperating with SEC investigation: Guggenheim Partners on Sunday said it was “cooperating fully” with an investigation of its asset management subsidiary that is being conducted by the U.S. Securities and Exchange Commission. The  company was asked to retain documents related to transactions involving a second company, ABS Capital Co LLC. The SEC is pursuing details on a real-estate transaction and other deals involving ABS Capital, which is owned by two former Guggenheim managers, the Wall Street Journal reported, citing unidentified people. [Reuters]

Comey says Trump is ‘morally unfit’ to be president: Donald Trump is “morally unfit” to be president, former FBI Director James Comey said in a highly anticipated prime-time interview Sunday, adding that he couldn’t rule out the possibility that the Russian government has incriminating information about the president. Comey told ABC News’ Chief Anchor George Stephanopoulos that he had concluded during the presidential campaign that Trump was dishonest. Americans should be united, he said, in the idea that “our president must embody respect and adhere to the values that are at the core of this country. The most important being truth.” [Bloomberg]

For more of the latest news, go to Yahoo Finance

Beyonce Knowles performs onstage during 2018 Coachella Valley Music And Arts Festival at the Empire Polo Field on April 14, 2018 in Indio, California. (Photo by Larry Busacca/Getty Images for Coachella )

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