New Strong Buy Stocks for December 18th

Bloomberg
Hedge Fund Collapse in Sweden Puts Spotlight Back on Quants
(Bloomberg) -- As one of Sweden’s oldest hedge funds shuts its doors, investors are trying to sort through the wreckage to figure out what exactly went wrong.Lars Ericsson, the chairman of soon-to-be defunct Informed Portfolio Management, says it’s clear now that the quantitative strategies his fund used failed to cope with the market moves brought on by the pandemic. But he rejects the idea that quants have had their day. “There is definitely a future for quantitative hedge funds,” he said on Thursday.IPM, a systematic macro fund based in Stockholm, started bleeding client money more than a year ago, with about $4 billion in assets under management flowing out since late 2019.Ericsson says the fund’s medium-term models failed to handle the shock that hit markets in early 2020.“When the pandemic came, it was a total surprise for the models,” he said.IPM then managed to come back from the brink, but bad trades that predated the pandemic came back to haunt the fund. Its relative equity models had been weighing on performance for years, due in part to a strategy relying on value stocks. This year, IPM’s models misjudged the relative gains in interest rates.Ericsson says he still thinks everything would have worked out had IPM had a little longer. As recently as half a year ago, it even hired some people from Goldman Sachs to help build out its business. But client withdrawals were too intense, and the fund had to give up.“We were about to add some short-term factors, which would have been good diversifiers,” he said. “But unfortunately, we won’t get that chance now.”Industry in Decline?IPM joins a growing list of hedge funds shutting down in recent years as investors rethink their allocations to the industry. More hedge funds have closed than started in the last six years, with 770 of them shuttering in 2020, according to data compiled by Hedge Fund Research Inc.Last year was particularly tough for computer-driven quant funds, including behemoths such as Renaissance Technologies, Winton and Two Sigma.IPM’s systematic macro strategy applied fundamental macroeconomic principles to rank asset classes and economies. It then allocated money across asset classes including sovereign debt, equity indexes, commodities and currencies across the world. The model was based on historical statistical data, and relied heavily on computers.Jonas Thulin, who oversees $6 billion as head of asset management at Erik Penser Bank AB in Sweden, says Ericsson is right to defend quant strategies, despite IPM’s demise. However, Thulin, who’s been able to increase assets under management roughly fourfold since 2018 using macro strategies, says quant models become dangerous when applied too narrowly.The Killers“The usual killers of quant strategies are so-called paradigm shifts and shocks,” he said.Thulin says the way around this is a methodology he calls “dynamic macro.” The idea is that asset managers “constantly run parallel universes of historical relationships and explanatory variables and structures.” Part of the idea is also that the model isn’t used to predict the future, “but rather, the market’s perception of the future,” which requires a human sanity check.That approach helped Thulin deliver a 26% return over the past year on his firm’s multi-asset portfolio, compared with the 5-7% annual return it targets. The global stocks portfolio he oversees is up 39% over the period.Ericsson notes that the long-term trend suggests that the share of total assets being managed under quantitative strategies is increasing, “even though there may be a temporary setback now.”But for IPM, “assets under management decreased faster than we had expected and with that asset base it is difficult to maintain the quality we want.”(Adds comment in 8th paragraph, more details of strategy in 11th)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.
3h ago
Bloomberg
Ambani’s Reliance Buys Iconic Stoke Park for $79 Million
(Bloomberg) -- Reliance Industries Ltd., controlled by Asia’s richest person Mukesh Ambani, bought Stoke Park Ltd. for $79 million, adding an iconic locale that’s been the setting for two James Bond films to its portfolio of tourism properties.A wholly owned unit of Reliance Industries will buy Stoke Park, which owns and manages a hotel, sports and leisure facilities in Buckinghamshire, for 57 million pounds ($79 million), according to an exchange filing late Thursday. The acquisition will add to Reliance’s consumer and hospitality assets, the filing said.The property’s rolling golf course has been famous since James Bond played a game with Auric Goldfinger there in the 1964 blockbuster. Since then, the estate with the Georgian-era mansion set in the midst of 300 acres of parkland has also been a backdrop in productions like “Bridget Jones’s Diary” and Netflix Inc.’s British Royal Family drama “The Crown”.In real life, its 49 luxury bedrooms and suites, 27-hole championshop golf course, 13 tennis courts and 14 acres of private gardens attracts wealthy tourists from across the world.The latest marquee acquisition for Indian billionaire Ambani’s retail-to-refining conglomerate marks its pivot toward consumer offerings and yet another high-profile British brand purchase. Reliance bought struggling U.K.-based toy store chain Hamleys in 2019 and is seeking to revive it.Flush with $27 billion in fresh capital after selling stakes in Reliance’s retail and digital units last year, Ambani is helming a transformation as he seeks to build consumer services into a equal-sized pillar for Reliance Industries, paring dependence on profits from its traditional oil refining business. Acquiring marquee global brands underscores that strategy.Private GardensAlthough the Stoke Park estate has a recorded history of over 900 years, it was used as a private residence until 1908, according to its official website.Ambani has a net worth of $71.5 billion, making him the 13th richest person in the world, according to the Bloomberg Billionaires Index.The group “will look to enhance the sports and leisure facilities at this heritage site,” Reliance said in the filing. Ambani’s conglomerate has equity holding in EIH Ltd., which runs the chain of five star Oberoi Hotels.Reliance has announced acquisitions worth $3.3 billion in the past four years, with 80% of it in the media, technology and telecom sectors, according to an April 23 report by Morgan Stanley. Last year, Reliance bought out IMG Worldwide LLC’s 50% stake in their India sports management joint venture, signaling commitment to its sports and entertainment businesses.The U.K. is emerging as a real estate hotspot for wealthy Indians. Adar Poonawalla, chief executive officer of the Serum Institute of India Ltd. -- the largest vaccine manufacturer in the world -- agreed to rent a property in Mayfair for about 50,000 pounds ($69,300) a week, a record for the exclusive London neighborhood, Bloomberg reported last month.(Updates with comments from Morgan Stanley in the 10th 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.
1h ago
Reuters
New York City sues Exxon, BP, Shell in state court over climate change
The lawsuit comes after a federal appeals court this month rejected the city's effort to hold five major oil companies liable to help pay the costs of harm caused by global warming. The lawsuit said Exxon Mobil Corp, BP Plc, Royal Dutch Shell and industry group the American Petroleum Institute "have systematically and intentionally misled consumers" through fuel sales at branded stations as "cleaner" and "emissions-reducing" while not disclosing climate impacts.
17h ago
Bloomberg
Crypto Mogul Adds Bitcoin, Ether Fund Listings to His Empire
(Bloomberg) -- Huobi Technology Holdings Ltd. has launched four cryptocurrency-related funds targeting $100 million in total assets by September, the latest attempt to ride a stunning rally in digital assets.Huobi Tech is rolling out four funds including ones that will virtually track Bitcoin and Ether prices, allowing investors to bet on the coins without actually holding any currency. It’s the latest so-called crypto tracker after similar funds have launched around the world. The firm already has secured $50 million in commitments across the four funds.The offerings also include an active fund investing in a basket of virtual assets, and a private equity fund dedicated to investment in the crypto mining sector. In March, Huobi Tech obtained a license from the Securities and Futures Commission of Hong Kong to manage and distribute funds invested solely in crypto -- the first such approval after Arrano Capital.“Virtual assets have become established as a strong category in alternative investment, and more players will compete in this arena,” Huobi Tech finance chief Zhang Li said during a Zoom interview from Beijing. “For professional investors who still have concerns about things like security and tax filing, they will opt to buy our funds rather than holding coins themselves.”The new Hong Kong license and funds highlight 38-year-old Huobi founder Leon Li’s endeavor to ensure his crypto empire, whose main exchange unit has drawn scrutiny over the years from Beijing, complies with regulations as it expands into adjacent arenas.The move also come as mainstream financial companies embrace crypto after Bitcoin’s value took off in October. However, some still warn of a bubble, and volatility and regulatory risk around the globe remain concerns for the asset class.Longer term, Zhang said she expects the firm to provide a full suite of crypto-related services including custody, without specifying details.Read more: The Crypto Mogul Who’s Got the Ear of China’s Central BankFor 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.
1d ago
Reuters
Intel PC chip sales rise, but profit forecast falls short on manufacturing costs
Intel Corp on Thursday raised its annual sales outlook on booming demand for personal computers, but its second-quarter profit forecast fell short of analyst expectations as the company spends heavily to get its manufacturing operations back on track and catch up to rivals with faster chips. Intel shares were down 3.1% to $60.60 in after-hours trading after the results. The company also missed first-quarter expectations in its closely watched data center chip unit.
8h ago
Yahoo Finance
Stock market news live updates: Stocks sink after report says Biden will propose higher capital gains tax on the wealthy
Stocks rose for the first time in three days earlier on Wednesday.
13h ago
BBC
NIO: 'Tesla killer' wants better US-China cooperation
Electric carmaker NIO is at the forefront of China's effort to dominate the electric vehicle market.
1d ago
Bloomberg
Romanian Programmer Turns ‘Crazy Idea’ Into $6 Billion Fortune
(Bloomberg) -- Daniel Dines struggled with life in the U.S. after leaving his native Romania in 2001 to work for Microsoft Corp., but the experience created the foundation for one of the world’s biggest fortunes.The software programmer returned to his homeland in 2005 to start the business known today as UiPath Inc., an automation-software maker that debuts Wednesday after raising $1.3 billion in a U.S. initial public offering. Dines, the company’s chief executive officer, controls a stake worth more than $6 billion, according to data compiled by Bloomberg.“For someone coming in his 20s to the U.S. from Europe, it was a big challenge for me to adapt to the States, even though professionally speaking my experience at Microsoft was great,” Dines, 49, said last year at the annual Montgomery Summit technology conference.As a result, “I had a crazy idea to go back and start a company,” he added.‘Hidden Advantage’UiPath, which was valued at $7 billion in 2019, is now worth about $30 billion after its shares priced at $56, above a marketed range. That puts Dines among the world’s 500 richest, according to the Bloomberg Billionaires Index. A company representative declined to comment.“Starting a company from a small place with no market has a hidden advantage: It forces you to think globally from day one,” Dines said in a letter included in UiPath’s registry filings for its listing. He had already indicated his company was preparing for a listing back in early 2020.The company’s software performs many low-skilled tasks that businesses once outsourced to humans in cheaper-wage countries such as India or the Philippines. Known as robotic process automation technology, the technique takes over repetitive, routine data-entry and processing tasks. Some of its software has been used in hospitals and health-care projects to help with Covid-19, according to UiPath’s website.Dines, who studied math and computer science at the University of Bucharest, grew up in Romania while the nation was still ruled by dictator Nicolae Ceausescu. He founded the company as DeskOver and renamed it UiPath in 2015, running it out of an apartment in the capital before relocating its headquarters to New York in 2017.Funding RoundUiPath raised $750 million in a funding round led by Alkeon Capital and Coatue that gave it a value of $35 billion, according to a February statement. Altimeter Capital Management, Dragoneer, IVP, Sequoia Capital, Tiger Global Management and funds advised by T. Rowe Price Associates also chimed in.Dines owns all of the company’s Class B shares, which carry 35 votes apiece compared with one each for Class A stock. He will continue to control UiPath after the IPO and sold shares in the offering worth about $75 million, according to filings.“You have to become a public company at some point to allow your employees to get more liquidity, give them stock options,” he said in an interview with Bloomberg last year. “We’re almost there.”(Adds details of share sale in penultimate 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.
2d ago
Bloomberg
Sanjeev Gupta’s Father Has Moved From U.K. as Group Battles for Survival
(Bloomberg) -- Parduman Gupta, father of embattled metals tycoon Sanjeev Gupta, has moved out of the U.K., just as the pair’s GFG Alliance teeters on the brink following the collapse of its largest lender Greensill Capital.The senior Gupta has changed his country of usual residence from Britain to India, according to several filings made over the past few weeks at Companies House, the business registry. He owns Simec Group, the branch of the business empire which deals in renewable energy, shipping and mining, and was founded by the magnate as an export-and-import house in India.It’s not clear where Parduman Gupta is currently, but a spokesman for Companies House said that a company director must list their country of residence, and that this “should correspond with their usual residential address.” A spokesman for GFG Alliance, a loose grouping of companies owned by the father and son, declined to comment.Sanjeev Gupta has also been absent for several months from the U.K., where GFG owns numerous steel and aluminum plants and employs around 5,000 people. He said on recent podcasts for GFG employees that he left the U.K. for Dubai before Christmas, and hasn’t returned since.“Dubai is the perfect location for me and my family to operate out of for now,” Gupta said on a April 16 podcast, citing the city’s time zone.But he said that he was keen to be on the move again. “As soon as Covid travel restrictions in the U.K. and Australia and Europe are lifted I will definitely be trying to get in front of the customers and employees around the world.”‘Very Opaque’GFG last month asked the U.K. government for a 170 million-pound ($235 million) bailout, but the request was rebuffed. Business Secretary Kwasi Kwarteng told a parliamentary committee last week that it would be “very irresponsible” to give taxpayers’ money to the group, describing it as “very, very opaque” and having “liabilities that nobody seems to have got to the bottom of.”GFG has borrowed about $5 billion from Greensill, and is desperately seeking fresh financing, which Sanjeev Gupta is coordinating from Dubai.Some progress has been made. Three lenders are in talks to refinance one of his Australian steel mills, while a private equity firm has positioned itself to buy two of the group’s aluminum plants.Still, other parts of the business are facing difficulties. Three French units were put into voluntary administration last week, while other parts of GFG in France and Belgium have sought protection from their creditors.Gupta said on the April 16 podcast that some of his U.K. assets were “struggling at the moment with the lack of funding.” He called on GFG employees to be “brave,” but warned of “some difficult decisions” to come.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.
19h ago
Quartz
Netflix says Disney had nothing to do with its underwhelming quarter
Netflix added just 4 million new subscribers this quarter, compared to the 6 million it expected. The streaming service blamed Covid-related production delays leading to a "lighter" than usual content slate.
2d ago
Bloomberg
Turkish Crypto Exchange Goes Bust as Founder Flees Country
(Bloomberg) -- One of Turkey’s largest cryptocurrency exchanges said it lacked the financial strength to continue operations, leaving hundreds of thousands of investors fearing their savings have evaporated as authorities sought to locate the company’s 27-year-old founder, who fled the country.Confusion reigned about how many users of the Thodex exchange were affected and how much money was at stake. In a statement from an unknown location, Thodex Chief Executive Officer Faruk Fatih Ozer promised to repay investors and to return to Turkey to face justice after he did. The government moved to block the company’s accounts and police raided its head office in Istanbul.Losses could be as high as $2 billion, according to Haberturk newspaper, and a lawyer for the victims said the money invested by about 390,000 active users had become “irretrievable.” Both figures have been disputed by Ozer. About 30,000 users have been impacted, he said in a statement on the company’s website on Thursday.While authorities and customers tried to work out the details of what happened, a senior official in President Recep Tayyip Erdogan’s office called for rapid regulation of the crypto market. Globally, the surge in the prices of digital tokens has been accompanied by convictions and regulatory measures after various scams tied to trading platforms.The Turkish government should take action “as soon as possible,” Cemil Ertem, a senior economic adviser to Erdogan, told Bloomberg. “Pyramid schemes are being established. Turkey will undoubtedly carry out a regulation that’s in line with its economy but also by following global developments.”Alternative InvestmentsThodex was part of the cryptocurrency boom that has drawn in legions of Turks seeking to protect their savings from rampant inflation and an unstable currency. Inflation hit 16.2% in March, more than three times the central bank’s target of 5%. The Turkish lira has weakened 10% against the dollar this year, its ninth consecutive year of losses.The government spent a massive $165 billion in foreign-exchange reserves over the past two years, Erdogan revealed on Wednesday, part of a futile effort to prop up the national currency. Concern about the country’s dwindling foreign-exchange reserves, which are negative when money borrowed by the government from private banks via swap agreements are factored in, has fueled concern about both lira and dollar deposits -- and pushed savers into alternative investment vehicles.Last Friday, the volume of trade in Turkish crypto markets tripled to over $1.2 billion from a week earlier, according to data published by coingecko.com, which tracks data on price, volume and market value on crypto markets. That compares with an average daily trading volume in the Turkish stock market’s benchmark index of about $3.1 billion.“One can establish a crypto exchange with just 50,000 liras (about $6,000) in capital,” Oguz Evren Kilic, a lawyer representing Thodex users, said by phone. “There’s a huge regulatory gap in this field.”Ozer didn’t respond to multiple calls to his mobile phone. The company’s call center also didn’t pick up calls. Bedirhan Oguz Basibuyuk, Thodex’s lawyer, told Bloomberg he doesn’t know where Ozer is but that he’s not in Turkey. Demiroren News Agency reported that he fled to Albania on Tuesday, publishing what it said was a photo of him at Istanbul’s airport.Dogecoin CampaignLast month, Thodex initiated a campaign to boost membership by offering millions of free Dogecoins to new registrants. Its website says 4 million of the coins were distributed, though many people have taken to social media to complain they never received them.“I was born as one of the three siblings of a civil servant,” Ozer said in his statement, adding that he’s a high-school dropout. As the company ran into financial trouble, he said he thought about either committing suicide or giving himself up to authorities, but both of those options meant clients’ assets would never be retrieved.“So I decided to stay alive and fight, work and repay my debts to you,” he said. “The day I repay all my debt, I will return to my country and give myself in to justice.”(Updates with new lede, government agency action, details 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.
17h ago
Bloomberg
Bitcoin Drops Below $50,000 Amid Tax and Momentum Concerns
(Bloomberg) -- Bitcoin headed for its worst week in more than a year as a proposed capital-gains tax increase for wealthy Americans intensified the volatility whiplashing the world’s largest cryptocurrency.A fresh bout of selling on Friday drove Bitcoin down as much as 7.9% to about $47,525 as it continued to take out key technical levels. Wall Street analysts warn of further losses for the notoriously volatile currency that hit a record high of $64,870 on April 14 ahead of Coinbase Global Inc.’s listing, before succumbing to an unexplained weekend swoon.This week’s 22% rout marks the worst period for Bitcoin since March 2020. Even digital currencies that have managed to eke out gains over the past few days, like Ether and the satirical Dogecoin, tumbled on Friday as the crypto space turned into a sea of red.“Bitcoin has slipped below the 50-day moving average support that it held sacrosanct through this rally,” said Pankaj Balani, CEO of Delta Exchange. “It looks like there is more downside here.”Read more: Wall Street Starts to See Weakness Emerge in Bitcoin ChartsThe latest threat comes from a Bloomberg News report Thursday that the Biden administration is considering raising the tax on capital gains to 39.6% for those earning more than $1 million a year. That was enough to ignite the biggest slide in U.S. stocks in five weeks. U.S. investors in Bitcoin, which has advanced more than 70% this year despite its recent pullback, already face a capital gains tax if they sell the cryptocurrency after holding it for more than a year.But the coin’s been one of the best-performing assets in recent years -- anyone who bought a year ago is sitting on a nearly 550% gain. For investors who bought in April 2019, it’s roughly 800%.“One of the biggest things you have to worry about is that the things with the biggest gains are going to be most susceptible to selling,” said Matt Maley, chief market strategist for Miller Tabak + Co. “It doesn’t mean people will dump wholesale, dump 100% of their positions, but you have some people who have huge money in this and, therefore, a big jump in the capital gains tax, they’ll be leaving a lot of money on the table.”The IRS has stepped up enforcement of tax collection on crypto sales. The agency -- which began asking crypto users to disclose transactions on their 2019 individual tax returns -- asks taxpayers whether they “received, sold, sent, exchanged or otherwise acquired any financial interest in any digital currency.”Still, investors may need to buckle up for more volatility in the near-term.“People have been talking about the capital gains tax and U.S. stock-market selloff being the catalyst of this,” said Todd Morakis, co-founder of digital-finance product and service provider JST Capital. “If it is true we’ve moved too much -- but once Bitcoin gets a head of steam it is tough to stop unless you are at a technical area.(Updates 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.
1h ago
Reuters
World stocks steady, Bitcoin slides on U.S. tax hike prospect
LONDON (Reuters) -Global shares steadied on Friday around 1% below record highs reached earlier this week, though Bitcoin hit its lowest in nearly seven weeks as investors assessed the impact of a possible U.S. capital gains tax hike. President Joe Biden will roll out a plan to raise taxes on the wealthiest Americans, including the largest-ever increase in levies on investment gains, to fund about $1 trillion in childcare, universal pre-kindergarten education and paid leave for workers, sources familiar with the proposal said. Biden's administration is seeking an increase in the capital gains tax to near 40% for wealthy individuals, almost double the current rate, the sources said.
7h ago
Reuters
Chanel loses European court fight in trademark dispute with Huawei
French luxury house Chanel on Wednesday lost its trademark fight with Huawei Technologies after a top European court said their logos bear no similarity to each other. The dispute dated to 2017 when Huawei sought approval from the EU Intellectual Property Office (EUIPO), a trademark body, to register its computer hardware trademark which has two vertical interlocking semi-circles. Privately owned Chanel objected, saying that the design was similar to its registered French logo of two horizontal interlocking semi-circles used for its perfumes, cosmetics, costume jewellery, leather goods and clothing.
2d ago
MoneyWise
Take Warren Buffet's advice to make the most of your tax refund
The investing icon spells out what you should — and shouldn't — spend that money on
17h ago
Bloomberg
Malaysia Sells World’s 1st Sovereign Dollar Sustainability Sukuk
(Bloomberg) -- Malaysia became the first country to sell a dollar Sukuk linked to sustainable activities, adding to a growing number of issuers turning to debt financing for environmental and social projects.The Southeast Asian country priced $800 million of 10-year sustainability Islamic finance notes on Wednesday, Malaysia’s finance ministry said. The deal also included a $500 million 30-year tranche. The offering was oversubscribed by 6.4 times.Sustainable debt issuance rose 29% last year to a record $732 billion, according to figures from BloombergNEF. Indonesia sold green debt that complies with religious principles in 2018, making it the first country in the world to issue such securities, according to a United Nations Development Programme report.“Demand for ESG or sustainability-linked bonds continues to gain traction while there is still a limited supply” of such issuance from Southeast Asia, said Winson Phoon, head of fixed-income research at Maybank Kim Eng Securities in Singapore. “Adding the sustainability label helps widen further the investor base.”Spreads on both parts of the deal tightened during marketing, and the sustainability Sukuk sold at 50 basis points over Treasuries compared with initial price guidance of around 90 basis points. The deal resulted in the lowest-ever yield and spread for a U.S.-dollar Sukuk issuance by Malaysia, the finance ministry said.Malaysia is an infrequent issuer in overseas bond markets, last selling dollar debt in 2016. Its existing U.S. currency notes have a longer duration than Asian credit more broadly, which made them vulnerable to a selloff last quarter as yields spiked. They’ve since recouped some losses as interest rates retreated.Like governments around the globe, Malaysia has been tackling the impact of the pandemic, and Prime Minister Muhyiddin Yassin unveiled a 20 billion ringgit ($4.9 billion) stimulus package last month that included discounts on power bills, tax breaks and cash aid to the poor.Malaysia’s gross domestic product may expand 6% to 7.5% in 2021, its central bank said last month. That’s potentially slower than its earlier projection of 6.5%-7.5% growth, but still ahead of many of its neighbors.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.
1d ago
Bloomberg
Inflation Forces the Bank of Canada’s Hand Ahead of Fed and ECB
(Bloomberg) -- The Bank of Canada sent out a warning to investors this week that inflation still matters.In a surprise move, it accelerated the timetable for a possible interest-rate increase and began paring back its bond purchases on Wednesday. That made Canada the first major economy to signal its intent to reduce emergency levels of monetary stimulus.It’s a turn in policy by Governor Tiff Macklem that shows there’s a limit to how much he’s willing to test the upper boundaries of inflation, with new forecasts showing the central bank expects the biggest persistent overshoot of its 2% target in at least two decades. The question is whether Canada’s situation is unique, or foreshadowing the start of a global exit from stimulus.Markets, however, see it as an outlier so far.“Canada does give you a flavor of what happens when your trajectory is stronger than anticipated,” said Su-Lin Ong, head of Australian economic and fixed-income strategy at Royal Bank of Canada in Sydney.While the Canadian dollar jumped the most since June on Wednesday, the Bank of Canada’s big move didn’t cause much of a ripple effect in global markets. The MSCI benchmark for global stocks is trading within 1% of a record high. Ten-year U.S. Treasury yields have fallen below 1.6%, from 1.74% at the end of March, as investors pare expectations that the Federal Reserve will raise rates soon.‘Distinguishing Factors’Counterparts elsewhere, meanwhile, are resisting. At a decision Thursday, European Central Bank President Christine Lagarde said the institution isn’t discussing the phasing out of its emergency bond buying, while the Federal Reserve has long been adamant it won’t scale back the pace of its $120 billion-a-month bond purchases until it sees “substantial further progress” on employment and inflation.“Central banks of small economies can sometimes be canaries in the coal mine,” Krishna Guha, vice chairman at Washington-based Evercore ISI, said in a report to investors. “But while there are some elements of this decision that have an obvious read-across to other central banks, there are also distinguishing factors that caution against naive extrapolation.”Some analysts don’t even see the Canadian central bank taking a dramatically more aggressive policy stance, even after Wednesday’s move. At a press conference after the decision, Macklem emphasized the central bank’s commitment is not to raise interest rates before the economy fully recovers, and that any future hike would reflect economic conditions at the time.Macklem is right-sizing one of the more aggressive quantitative easing programs relative to the size of its bond market, in an economy also being supported by massive fiscal stimulus. The Bank of Canada owns more than 40% of outstanding federal government bonds, potentially distorting the market.“Canada is different. The amount of the bonds they are buying is huge,” Steve Englander, head of global G-10 FX research at Standard Chartered Bank in New York, said by phone. “The Fed doesn’t have that issue.”The economic fundamentals are also pretty solid. Canada’s jobs market has recouped 90% of losses during the pandemic, versus just over 60% of U.S. losses made up so far. Canada’s red-hot housing market is another worry.“The situation is sufficiently unique in Canada that I’m not sure it applies to the Fed, or ECB,” Jean-Francois Perrault, chief economist at Bank of Nova Scotia, said by phone. “Our labor market basically is back to where it was.”What Bloomberg Economics Says...“The Bank of Canada brought forward when it expects the economy’s excess slack to be absorbed, but the accompanying Monetary Policy Report includes discussion of several factors that could soften the need to pull forward a rate hike into 2022. We continue to think a rate move is likely to be delayed into the first quarter of 2023.”--Andrew Husby, economistFor a full report, see herePerhaps more consequential, the Bank of Canada’s mandate is narrow -- focused on a 2% inflation target, with some flexibility over timing. Consumer price gains are expected to be at or above that mark for more than 70% of the forecast horizon to the end of 2023, according to Bloomberg calculations on Bank of Canada data.Macklem justified his tolerance for above-target inflation this week by citing the central bank’s decision not to preemptively raise rates until a full recovery. It’s a policy that’s paralleled in the U.S.But the Fed is juggling a number of objectives. These include growing concerns about racial equity that suggest it’s waiting for the headline jobless number to drop even below estimates of full employment.A more accommodative approach was formalized in a policy review last year that now allows the Fed to explicitly overshoot 2% inflation moderately for some time. It’s an option the Bank of Canada is considering as it completes its own mandate renewal later this year.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.
13h ago
Reuters
Chanel loses European court fight in trademark dispute with Huawei
French luxury house Chanel on Wednesday lost its trademark fight with Huawei Technologies after a top European court said their logos bear no similarity to each other. The dispute dated to 2017 when Huawei sought approval from the EU Intellectual Property Office (EUIPO), a trademark body, to register its computer hardware trademark which has two vertical interlocking semi-circles. Privately owned Chanel objected, saying that the design was similar to its registered French logo of two horizontal interlocking semi-circles used for its perfumes, cosmetics, costume jewellery, leather goods and clothing.
2d ago
Bloomberg
Bain, Oaktree in Talks to Fund Some of Gupta’s Australian Units
(Bloomberg) -- Bain Capital Credit, Oaktree Capital Group and White Oak Global Advisors are in talks to refinance some of Sanjeev Gupta’s borrowing from Greensill Capital at some of his Australian businesses.The funds have been carrying out due diligence to provide at least A$430 million ($333 million) to GFG Alliance’s Australian Mining and Primary Steel units, including the Whyalla steel mill in the south of the country, according to people familiar with the matter. One of the funds could conclude a deal with GFG as soon as early May, said the people, who asked not to be named because the talks are private. There is no certainty the talks will result in a deal, the people said.Officials at GFG and Oaktree declined to comment on the talks. Representatives for Bain and White Oak weren’t immediately available to comment.The financing would provide relief for Gupta as he attempts to secure the future of his teetering metals empire following the demise of Greensill, his largest backer, in March. Gupta’s GFG has borrowed about $5 billion from Greensill, of which some A$430 million was through a facility for the Australian Mining and Primary Steel business.Just How Big and Important Is Sanjeev Gupta’s Metals Empire?The refinancing of that facility would allow Gupta to fend off an attempt by Credit Suisse Group AG to wind up some of the Australian assets. The Swiss bank is seeking to push some GFG units into insolvency to recover part of the loans it made to the group through Greensill. A first hearing on the petition is scheduled for May 6.South Australia Premier Steven Marshall said on Sunday that he was hopeful a deal could be done before May 6.“When I spoke to Sanjeev Gupta this time last week he was increasingly confident that he will be able to get that credit arrangement in place,” Marshall said at a press conference.The Whyalla mill is a supplier to steel product manufacturer Infrabuild Australia Pty Ltd., GFG’s most profitable unit.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.
2d ago
FX Empire
Gold Price Futures (GC) Technical Analysis – Plenty of Room to Upside if Buyers Successfully Defend $1788.50
The direction of the June Comex gold market on Thursday is likely to be determined by trader reaction to the major 50% level at $1788.50.
1d ago

Symbol	Last Price	Change	% Change
BGSF BGSF, Inc.	13.69	-0.04	-0.29%
DDS Dillard's, Inc.	99.77	+1.64	+1.67%
SWBI Smith & Wesson Brands, Inc.	17.71	-0.13	-0.73%

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