|Day's Range||7,094.98 - 7,188.59|
|52 Week Range||6,536.50 - 7,727.50|
It’s a particularly busy week ahead. The markets will need to monitor updates from the G7 summit, chatter on trade, Brexit and the stats.
In a see-saw session, European stocks ended lower on Friday, as relief that the Federal Reserve would consider cutting interest rates again was offset by a new escalation in the U.S.-China trade war.
(Bloomberg) -- Uninvestable. A lose-lose proposition. Avoid for now.While the jury is still out on whether British Prime Minister Boris Johnson will succeed in Brexit negotiations, strategists are pretty much unanimous in their calls to steer clear of U.K. equities. The likes of JPMorgan Chase & Co., UBS Wealth Management and Sanford C. Bernstein have written off U.K. shares from their investment playbooks until there’s more political clarity.For the benchmark FTSE 100 Index, whose cyclical shares are already suffering blows from trade war tensions in August, it could be a “lose-lose” situation, as JPMorgan puts it. If Johnson pulls off a miracle and seals a deal before the end of October, a rally in sterling would weigh on the exporter-heavy gauge. And if Britain exits without a deal, a worst-case scenario for most prognosticators, any positive impact of a weaker pound on the gauge’s exporters might quickly give way to a slump fueled by fears of an economic downturn.Earlier this week, French President Emmanuel Macron gave Johnson little hope he’s prepared to compromise on Brexit and said any changes to the current deal won’t be very significant. “There are simply better things to go and buy,” said Inigo Fraser Jenkins, head of global quantitative strategy at Bernstein. U.K. equities are “uninvestable,” and not cheap enough to make up for political risks that are hard to forecast, he said.Among global investors polled by Bank of America Corp. this month, 29% are underweight the U.K., more than in July. The survey also shows just how confused market players are about the timeline of Brexit’s resolution, with 28% of participants saying Britain is likely to leave the European Union on or before Oct. 31, and 21% expecting the nation to exit in November, December or in the first half of next year.“We believe it is not prudent to base investment decisions on a particular Brexit scenario,” said Willem Sels, a London-based chief market strategist at HSBC Private Bank. “Several potential outcomes exist, and the market’s assessment of the likelihood of these scenarios can continue to shift up and down.”Amid the widespread political uncertainty and shunning of U.K. stocks, BofA strategist Manish Kabra stands out as a lone bull.“The base case is the U.K. leaves with a deal,” he said by email. “We like U.K. stocks, mostly as the yield gap between equity and bonds has reached about 100-year wide levels."Indeed, the declines in the FTSE 100 have lifted its expected dividend yield to 5%, one of the world’s highest. This compares with a 0.6% yield on the generic 10-year U.K. government bond.Fast-money investors seem to be listening to BofA because the largest exchange-traded fund focused on U.K. stocks, the iShares Core FTSE 100 ETF, is poised for its biggest monthly inflow since January. Still, the benchmark index is heading for its worst monthly decline since 2015.The FTSE 100 Index and the more domestic-focused FTSE 250 Index are both down since Johnson won the Tory party’s vote to lead the country in late July, with the prime minister repeatedly urging the country to prepare for a no-deal outcome. The pound had its weakest close in decades earlier this month on concern an economic downturn would follow a chaotic exit from the EU.While the FTSE 100 has benefited from sterling’s weakness for the most part since the 2016 referendum, the inverse relationship could disappear in the case of a disorderly Brexit, with growth concerns outweighing any positive impact from a declining pound, according to JPMorgan’s Mislav Matejka. He has an underweight rating on U.K. stocks.While London & Capital Asset Management is ready to be opportunistic when there is political clarity, its head of equities Roger Jones said, “Investors should be discouraged from investing in the U.K. before a Brexit outcome as this is effectively wild speculation which will be dominated by political process or lack of it.”To contact the reporter on this story: Ksenia Galouchko in London at email@example.comTo contact the editors responsible for this story: Blaise Robinson at firstname.lastname@example.org, Namitha Jagadeesh, Celeste PerriFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Neil Woodford has raised at least 650 million pounds ($796 million) by selling listed assets held in his frozen flagship fund, as he prepares for a potential line of clients yanking their money when the fund reopens.The embattled stock picker shocked the financial world in early June by halting withdrawals from his LF Woodford Equity Income Fund after a run of poor results led to mounting redemption requests. He made the decision to buy time to sell down the fund’s holdings of lightly traded micro-, small- and mid-cap stocks that accounted for 97% its assets at the end of May, according to Morningstar data.Link Fund Solutions Ltd., administrator of Woodford’s flagship, said on Friday that the suspension will remain in place for at least another month, and that lifting it in December is “achievable.” The fund’s status is reviewed every 28 days.The fund has fallen by 11.2% since the suspension, compared with a 1.5% gain on its benchmark index, the FTSE All Share Total Return, according to Link.Stake SalesWoodford raised at least 300 million pounds in June by selling down stakes including those in BCA Marketplace, NewRiver REIT Plc and Oakley Capital Investments. Since then, his sales have included shares in Stobart Group, which focuses on aviation, energy and civil engineering, and Eurocell, a plastics manufacturer. He also reduced his stake in Crystal Amber Fund. Bloomberg’s calculation of the amount raised is based on public filings and market prices.A Woodford spokesman declined to comment on how much the fund has raised.Suspending redemptions is a rare step for any fund, let alone one, like Woodford’s, that allows clients to make regular withdrawals. Since announcing the freeze, he has lost key executives and long-time investors, has been hit by criticism from a top lawmaker and faces an investigation by the U.K. markets regulator. In response to Woodford’s woes, Bank of England Governor Mark Carney has said that funds offering daily liquidity while loading up on illiquid assets are “built on a lie.”Legal LimitIn another potential blow to Woodford, trading in shares of Eddie Stobart Logistics Plc was suspended on Friday pending clarification of the impact of some accounting issues. Woodford’s flagship fund owns about 22% of the company, according to Bloomberg data.Fresh concern has arisen recently about Woodford’s compliance with U.K. rules that limit how much open-ended funds like his can hold in unlisted securities. He breached the legal limit -- 10% of the value of the fund -- twice last year, and addressed this in part by having some securities listed on an exchange in Guernsey, according to the Financial Conduct Authority.Earlier this month, one of his holdings, Sabina Estates, was delisted from The International Stock Exchange, according to a statement on the TISE website. That followed the delisting in July of other stocks held by Woodford’s fund, including IH Holdings International Ltd. Unlisted holdings now account for more than 18% of the fund’s portfolio, according to Citywire.The net asset value of the listed Woodford Patient Capital Trust Plc was reduced on Friday by about 3.4 pence per share when Link lowered the valuation of the trust’s stake in IH Holdings.“We commenced the process of reducing the fund’s exposure to unquoted and less liquid assets in February,” the spokesman for Woodford said when asked about the delistings. “What you will see when the fund reopens is a portfolio with more FTSE 100 and FTSE 250 companies -- 80% of the proceeds from share sales since suspension have been reinvested in FTSE 100 stocks -- but still reflecting the same investment strategy.”(Updates with extension of fund suspension in third paragraph.)To contact the reporters on this story: Suzy Waite in London at email@example.com;Carla Canivete in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Shelley Robinson at email@example.com, Patrick Henry, Nishant KumarFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
World stock markets and the dollar rose on Friday as investors looked to a speech by Federal Reserve chair Jerome Powell for clarification on whether the U.S. central bank remains on course to deliver another interest rate cut in next month. Britain's FTSE 100 index was up 0.71%. Powell is due to speak at 1400 GMT at a gathering of central bankers in Jackson Hole, Wyoming.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.In the month since Boris Johnson became the U.K.’s prime minister, the pound has taken a heavy beating from no-deal Brexit rhetoric and that’s had a significant impact on a few areas of the London stock market.Sterling has fallen around 2.2% against the dollar since Johnson walked into 10 Downing Street on July 24. One side effect of that has been to make U.K. assets cheaper to overseas suitors, as seen with Greene King Plc and Entertainment One Plc. It’s also increased the attractiveness of companies making their money outside the U.K., while sapping sentiment toward domestic-focused segments like homebuilders and property stocks.Johnson heads to the G-7 summit and breakfast with President Donald Trump this weekend where Brexit is likely to be a topic of fierce discussion. Here are some of the areas where the impact appears to have been felt most in the first month of Boris.Pubs and Peppa PigOn the face of it, British pubs should suffer from any talk of no deal and the resultant knock to consumer confidence that could entail. That is, unless there are potential suitors for those pub estates lurking in the background.Greene King shares rocketed this week after Hong Kong’s CK Asset agreed to buy it for 2.7 billion pounds ($3.3 billion). The move, likely driven in part by the pound depreciating significantly against the Hong Kong dollar in recent weeks, also boosted Greene King’s pub sector cohorts, including Marston’s Plc and Mitchells & Butlers Plc, as speculation became rife that other deals could follow. Particularly given that the Greene King deal came after EI Group Plc, another pub firm, got a $1.6 billion takeover bid in July.The weak pound also likely sweetened the appeal to U.S. toy firm Hasbro Inc. of making a $4 billion offer for Entertainment One, the TV and film producer behind the hugely successful “Peppa Pig” children’s series.ExportersGiven the inverse correlation of the pound to the FTSE 100 index, the fall in sterling is creating benefits for companies that make most of their money in other currencies. Among the best performers in the last month are the likes of catering giant Compass Group Plc, medical-equipment supplier Smith & Nephew Plc and pest-control firm Rentokil Initial Plc, all of which make most of their money in dollars.Note another example in Victrex Plc, a chemicals firm that makes polymers used in cellphones and cars. Barclays Plc analysts upgraded their rating on the stock this week as a weaker pound will be a “powerful mitigating force” for the company against headwinds in its end markets. A no-deal Brexit, therefore, could prove to be a positive.HomebuildersHousebuilders are one of the most sensitive sectors to Brexit, given the impact the uncertainty has had on house prices and consumer appetite to borrow and spend. Bellwethers like Persimmon Plc and Taylor Wimpey Plc have both underperformed the more domestically focused FTSE 250 index in the month since Johnson started, with the former down 5.8% and the latter 14%.First-half results from the sector were broadly in line with expectations, albeit with the ongoing challenge of higher build costs hitting margins. But no-deal rhetoric and uncertainty about what kind of Brexit will eventually happen isn’t helping. “The installation of Boris Johnson has increased the risk of a hard Brexit in general and that will feed through into a weaker performance for the stocks,” Davy analyst Colin Sheridan said by phone.Beach HolidaysThe weak pound might be a boon for inbound tourism to the U.K., but it’s weighing on travel companies selling holidays to Brits going abroad. Budget beach holiday firm On the Beach Group Plc has had a miserable month after warning last week that full-year profit will miss expectations due to sterling’s decline.Brexit and the falling pound are adding to wider international concerns for the sector, according to Bernstein analyst Richard Clarke. “There are stocks out there that certain investors will not touch while that overhang is continuing,” he said.Shopping MallsThe FTSE 350 REITS Index is down 3.6% since Johnson took charge, about the same as the broader gauge. But Brexit sensitivity is not born equal in property and the companies most impacted, namely shopping mall owners Intu Properties Plc and Hammerson Plc, are suffering.Intu is down 57% since Johnson was installed and Hammerson has slid 18%, both after results that disappointed analysts. The two face the twin headwinds of retailers going out of business as Brexit hits consumer confidence plus the threat of online shopping. The Brexit deadline falling less than two months before Christmas could also put more pressure on already struggling retailers and, ultimately on the direction of rents for mall owners, Bloomberg Intelligence’s Sue Munden said.BanksThe main U.K.-focused banks -- Lloyds Banking Group Plc and Royal Bank of Scotland Group Plc, as well as smaller rivals CYBG Plc and Metro Bank Plc -- have all underperformed the Stoxx 600 Banks Index since Johnson became prime minister, as investors get jittery about the U.K.’s economic prospects.Lloyds and RBS, both key bellwethers for U.K. economic sentiment generally, have seen share prices fall more than downgrades to estimates would translate to, according to Macquarie analyst Robert Sage. That reflects the extra downside risks both face from the U.K.’s Brexit-bleakened outlook and until the overall climate improves, sentiment toward both is unlikely to brighten.\--With assistance from Sam Unsted.To contact the reporters on this story: Simon Foy in London at firstname.lastname@example.org;Ivan Edwards in London at email@example.comTo contact the editors responsible for this story: Beth Mellor at firstname.lastname@example.org, Paul JarvisFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The median pay package for a FTSE 100 chief in 2018 was £3.4m, down from £4m in 2017, according to data produced this week. Martin Sorrell was paid £13.9m at advertising group WPP last year before leaving.
European shares inched higher early on Friday, with all eyes on a speech by Federal Reserve Chief Jerome Powell for confirmation the the U.S. central bank is still on course to deliver another cut in interest rates next month. The highly-anticipated address at the Jackson Hole symposium is due at 1400 GMT and follows minutes from the Fed's July meeting which have cooled money market expectations of a bigger half-point cut next month. The pan-European STOXX 600 index rose 0.5% at 0710 GMT, rebounding from a fall on Thursday due to by mixed readings of business growth across major economies and as a jump in the pound slammed London stocks.
The past week has typified the lull that often becalms business news in late August. The lull also grants creative opportunities to corporate leaders who have shunned migrating to sunnier climes. Who knows where he was, but the heat must have got to Patrick Byrne, chief executive of US discount home furnishings group Overstock.com.
The Dow Jones Industrial Average rose slightly, and the S&P 500 and the Nasdaq Composite edged lower. Investors are waiting to hear from Federal Reserve Chairman Jerome Powell on Friday.
Merkel, Macron strike different tones but agree there’s little scope and time to renegotiate Irish backstop
The British pound jumped more than half a cent on Thursday to nearly a one-month high after German Chancellor Angela Merkel said a solution to the Irish border issue could be found before the Oct. 31 deadline for Britain to leave the European Union. The pound has fallen heavily in recent weeks on fears British Prime Minister Boris Johnson will take Britain out of the EU without a transition deal.
British stocks ambled lower on Thursday after signs emerged the Federal Reserve wasn’t rushing to cut interest rates, as a European tour by U.K. Prime Minister Boris Johnson did little to suggest the country would exit the European Union with a mutual agreement.
European stocks drifted lower on Thursday, after indications that the Federal Reserve last month wasn’t aggressively looking to cut interest rates.
The major European stock markets are trading higher at the mid-session and Asian shares finished mixed as investors await the release of the minutes from the U.S. Federal Reserve’s July monetary policy meeting. Additionally, there are reports that President Trump may be weighing measures to boost the U.S. economy. Perhaps keeping a lid on the markets are lingering concerns over U.S.-China relations after Trump “reiterated on Tuesday that he was not prepared to make a trade deal with China amid the current standoff, with Chinese communications giant Huawei still firmly in Washington’s cross hairs,” according to CNBC.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.There’s something striking about the timing of Victor Li’s bid for Greene King, as the pound trades against the Hong Kong dollar near levels last seen in the mid-1980s. With about two months to go before the Brexit deadline, and further potential currency weakness, it fuels the debate about opportunities to scoop up U.K. assets that look cheap on paper.Maybe it’s little wonder that there’s interest, as U.K. domestic shares (with at least 70% of sales within their home market) have depreciated since 2018 and have just hit a 10-year low in U.S. dollar terms. The case for those stocks has been made before, but is gaining ground -- particularly in the leisure space.Morgan Stanley analysts have noted particular interest from private-equity funds for U.K. companies in the industry. In June, Merlin Entertainments recommended a cash offer at a 37% premium, while Flutter is the subject of takeover speculation in the market. In the brewing space, Ei Group has supported a bid from TDR’s Stonegate Pub Co., at a 39% premium, while Fuller sold its brewing business to Asahi at high valuation multiples (23.6x EV/Ebitda). Looking at average price targets below, analysts aren’t so upbeat about the stocks, however.Still, buyers don’t see it that way. Richard Marwood, senior fund manager at Royal London Asset Management says the bid for Greene King shows that British assets “are not a no-go zone” for foreign companies. “This is another example of an overseas buyer showing an interest in a U.K. company, which is a positive signal during what remains an unprecedented time in the U.K.’s economy,” he adds. (NOTE: RLAM holds about 2.8% of Greene King, according to data compiled by Bloomberg).According to Barclays analysts, private equity funds could leverage the freehold structure of several leisure companies, including Whitbread, which has been the laggard of the sector this year. Brewer and pub company Marston’s has the greatest business similarity to Greene King, they said.Greene King Deal May Spell More U.K. Pub Closures, Say AnalystsEven if there aren’t many companies with Greene King’s characteristics, as Bloomberg columnist Chris Hughes highlighted, the flurry of deals, combined with the weakness of the currency, may start to offset some Brexit risk. The relative outperformance of the FTSE 250 in August vs. the FTSE 100 -- it’s down 3.4% vs 6.1% for the big-cap index -- may signal that investors are more optimistic about the U.K. consumer, as confidence shows signs of improvement.In the meantime, Euro Stoxx 50 futures are rising 0.1% ahead of the open, while S&P 500 contracts are up 0.3%.SECTORS IN FOCUS TODAY:Watch Italian stocks and bonds on the aftermath of Prime Minister Conte’s resignation. Stocks didn’t take the news so well, falling yet again as analysts branded the situation a “total mess.” More uncertainty is on the menu.Watch the pound and U.K. stocks as U.K. Prime Minister Boris Johnson is set to visit Angela Merkel and Emmanuel Macron this week as he attempts to garner support for his plans to renegotiate the current Brexit deal. Those overtures fell on deaf ears with the EU. Beyond that, the U.K. may wait until after Brexit to name a successor to Mark Carney heading the Bank of England.Watch for central banks’ comments, starting with Fed’s minutes on Wednesday. Traders are starting to prepare for the possibility that even if Fed Chairman Jerome Powell does signal further easing at his speech on Friday, the overall tone may disappoint. Traders also continue to find ways to play the inverted yield curve, though a Japanese mega fund thinks markets are now so synchronized that managers risk losing on every front.Watch the Lira and Turkey-exposed stocks as the currency took a hit with the dollar strength catching up with favored yield play among currency investors. Traders seem to anticipate the central bank is taking an easier monetary policy path than anticipated, raising the risk things could overheat again.COMMENT:“Widening sovereign spreads between Italy and Spain, Portugal over the last few months are an indication of market concerns about the M5S-Lega government,” commented Matteo Ramenghi, Chief Investment Officer for Italy at UBS GWM. “A M5S-PD coalition would likely introduce more fiscal discipline, but its lifespan would probably be short. Conversely, should elections take place, a win by the center-right might prove more market friendly than the current government, but the prospect of a populist win would lead to a bumpy ride for Italian assets.”NOTES FROM THE SELL SIDE:Tullow’s “world class” Guyana assets can move the company to the next level, Peel Hunt says, initiating at buy with PT 250p.Berenberg double-downgrades Nostrum to sell and slashes price target almost 88% to a Street-low, as the broker struggles to see any value in the equity.Citi initiates SEB with a buy rating, saying the French household appliances maker has a cheap valuation. PT of EU163 offers 20% upside to Tuesday’s closing price.COMPANY NEWS AND M&A:Stadler Wins CHF270m Train Order From Poland’s PKP IntercityFerguson Sounds Out Top Investors on Moving Listing to U.S.: FTUniCredit Starts Sale of EU1b Unlikely-to-Pay Loans, MF SaysCommerzbank May Close 100-200 Retail Branches: HandelsblattEDF Venture in Talks for Part of Rolls-Royce Nuclear Unit: SkyAtos Wins $198m Contract With State of CaliforniaDanish FSA to Report Danske to Police for Investment Product: JPLeroy Second Quarter Adjusted Ebit 3.5% Below EstimatesSports Direct Approaches Mid-Tier Auditors on Possible Tender:FTTECHNICAL OUTLOOK for Stoxx 600 index:Resistance at 374.5 (61.8% Fibo); ~386 (uptrend); 395.1 (July high)Support at 371 (200-DMA); 365.5 (50% Fibo, May low)RSI: 42.6TECHNICAL OUTLOOK for Euro Stoxx 50 index:Resistance at ~3,400 (uptrend) 3,403 (61.8% Fibo); 3,442 (50-DMA)Support at 3,249 (June/August low); 3,302 (200-DMA)RSI: 44.8MAIN RESEARCH AND RATING CHANGES:UPGRADES:2020 Bulkers upgraded to buy at BTIG; PT Set to 100 KronerBakkafrost upgraded to buy at Kepler Cheuvreux; PT 610 KronerCapita upgraded to buy at Goldman; PT 2 PoundsGEA Group upgraded to buy at Goldman; PT 30 EurosGreene King upgraded to hold at BerenbergJyske upgraded to hold at ABG; PT 205 KronerLeoni upgraded to buy at HSBC; PT 11.75 EurosNext upgraded to add at AlphaValueRaysearch Upgraded to Buy at Pareto Securities; PT 180 KronorScatec Solar upgraded to buy at SpareBank; PT 120 KronerTokmanni Group upgraded to buy at Goldman; PT 11.50 EurosDOWNGRADES:Bakkafrost downgraded to hold at SEB Equities; PT 558 KronerGreene King downgraded to sector perform at RBC; PT 8.50 PoundsLegal & General downgraded to hold at HSBC; PT 2.60 PoundsNostrum Oil & Gas downgraded to sell at BerenbergTalanx downgraded to hold at Nord/LB; Price Target 40 EurosINITIATIONS:AIB Group rated new equal-weight at Barclays; PT 3.30 EurosSEB rated new buy at Citi; PT 163 EurosTullow rated new buy at Peel Hunt; PT 2.50 PoundsMARKETS:MSCI Asia Pacific up 0.5%, Nikkei 225 down 0.3% S&P 500 down 0.8%, Dow down 0.7%, Nasdaq down 0.7%Euro down 0.05% at $1.1095Dollar Index up 0.06% at 98.25Yen down 0.24% at 106.49Brent up 0.5% at $60.4/bbl, WTI up 0.4% to $56.4/bblLME 3m Copper up 0.3% at $5730/MTGold spot down 0.3% at $1503.1/ozUS 10Yr yield up 2bps at 1.58% ECONOMIC DATA (All times CET):10am: (SP) June Trade Balance, prior -2.11b10:30am: (UK) July Public Finances (PSNCR), prior 15.2b10:30am: (UK) July Central Government NCR, prior 13.5b10:30am: (UK) July Public Sector Net Borrowing, est. -3.4b, prior 6.5b10:30am: (UK) July PSNB ex Banking Groups, est. -2.9b, prior 7.2b\--With assistance from Lisa Pham and Jan-Patrick Barnert.To contact the reporter on this story: Michael Msika in London at email@example.comTo contact the editors responsible for this story: Blaise Robinson at firstname.lastname@example.org, Jon MenonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Ferguson has sounded out top investors about switching its listing from the UK to the US, a proposal that has caused a transatlantic rift among shareholders at the £14bn plumbing merchant. in June that it had acquired an almost 6 per cent stake in Ferguson to become one of its largest shareholders. At the time, Trian said the group, previously called Wolseley, was “an attractive business that trades at a discount to comparable US peers”.
On June 3, U.K.’s most high-profile fund managers, Neil Woodford’s £3.75-billion ($4.55 billion) LF Woodford Equity Income Fund, was suspended as the fund manager struggled to free up cash to pay investors ...
Europe has a 70% chance of plunging into recession, according to renowned economist and bond market expert Mohamed El-Erian, with Britain, Italy and Germany “paralyzed” by domestic issues that have stalled the economies of the EU’s most powerful nations.
Stock markets edged higher on Tuesday as investors welcomed signs that more monetary and fiscal stimulus was on its way, hoping more easing would help stave off a major global economic downturn. After a tumultuous first half of August when investors dumped equities and poured their money into government debt and other safe havens, some calm has returned to markets this week amid talk of more stimulus in China and Germany.
Chief executives of the UK’s largest businesses received a pay cut of 13 per cent last year, although they still earned 117 times the average salary, according to an influential annual report on FTSE 100 remuneration. The report by the CIPD, the professional body for the HR industry, and the High Pay Centre think-tank found that the nation’s top chief executives shared a pot of £465.4m last year, receiving a median of £3.46m each. Luke Hildyard, director of the High Pay Centre, said the pay drop for chief executives was the result of Britain’s top company leaders becoming the “lightning rod” for anger about executive pay.