BCLYF - Barclays PLC

Other OTC - Other OTC Delayed Price. Currency in USD
-0.0248 (-1.16%)
At close: 1:43PM EST
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Previous Close2.1348
Bid0.0000 x 0
Ask0.0000 x 0
Day's Range2.1000 - 2.2100
52 Week Range1.6000 - 2.2400
Avg. Volume47,216
Market Cap37.563B
Beta (3Y Monthly)0.81
PE Ratio (TTM)75.36
EPS (TTM)0.0280
Earnings DateN/A
Forward Dividend & Yield0.09 (4.20%)
Ex-Dividend Date2019-08-08
1y Target EstN/A
  • Reuters

    UPDATE 1-Company logos vanish from Prince Andrew's website as sex scandal grows

    A scheme for entrepreneurs founded by Prince Andrew has taken down the logos of its corporate sponsors from its website, as firms and charities distance themselves from the British royal over a sex scandal. Andrew, Queen Elizabeth's second son, denies an allegation that he had sex with a 17-year-old girl procured for him by his friend Jeffrey Epstein, who killed himself in a U.S. prison in August while awaiting trial on sex trafficking charges. The scandal has escalated since Andrew's rambling denials and explanations in a disastrous TV interview aired on Saturday left many viewers incredulous, and his apparent lack of compassion for Epstein's victims drew widespread condemnation.

  • Bloomberg

    EM Review: Trade Talk Uncertainty Dominated Amid Mixed Signals

    (Bloomberg) -- Emerging-market currencies had the first weekly decline in seven last week as positive developments on a “phase one deal” between the U.S. and China failed to reverse days of largely risk-off sentiment. President Donald Trump’s administration signaled late Thursday that talks with China over the first phase of a broad trade agreement are entering the final stages, though added caveats a day later that a deal is close but not completed. Stocks in developing nations halted a month of weekly gains, falling the most since late September.The following is a roundup of emerging-markets news and highlights for the week ending Nov. 18.Read here our emerging-market weekly preview, and listen to our weekly podcast here.Highlights:U.S. and Chinese trade negotiators held “constructive discussions” in a phone call on Saturday to address each side’s core concerns of phase one of the trade deal.White House economic adviser Larry Kudlow said negotiations over the first phase of a trade agreement with China were coming down to the final stages. Kudlow said a deal is close though “not done yet”President Donald Trump said the U.S. will increase tariffs on China in case the first step of a broader agreement isn’t reached. He also said China is devaluing its currency, supply chains are cracking and they are “dying to make a deal”Trump said trade talks are moving “rapidly”A U.S. demand that China spell out how it plans to reach as much as $50 billion in agricultural imports annually has become a sticking point in negotiations, according to people familiar with the matterChina lowered the cost it charges on open-market operations for the first time since October 2015. The People’s Bank of China cut the interest rate on its seven-day reverse repurchase agreements to 2.5% from 2.55%The country’s economy slowed further in October, signaling that policy makers’ piecemeal stimulus is failing to boost output and investmentFederal Reserve Chairman Jerome Powell stuck to his view that interest rates are probably on hold after three straight reductions, while signaling that the U.S. central bank could resume cutting if the growth outlook faltersTrump renewed his assault against the Fed, saying it was hurting the U.S. by not copying other central banks in deploying negative interest ratesTrump said Wednesday that Turkey’s purchase of a Russian anti-aircraft missile system presents “some very serious challenges” for the U.S., and directed Secretary of State Michael Pompeo to work on resolving the impasseThe Lebanese army was deployed heavily across the country on Wednesday and banks and schools remained shut for a second day as protesters incensed by a call to go home began to converge on the presidential palaceS&P downgraded Lebanon’s long-term foreign currency debt rating to CCC from B-Major political parties agreed to name businessman and ex-finance minister Mohammad Safadi as the country’s new premier, local media reported, a choice that was immediately rejected by anti-government demonstrators pressing for deeper change. Mohammed Safadi put an end to his bid just two days after winning the backing of Lebanon’s major political partiesThe central bank has no plans to impose formal restrictions on the movement of money or force depositors to accept losses, its governor said, but will offer “unlimited” dollars for commercial lenders to finance trade and meet customer demandBanks agreed to lift a restriction on new money coming from abroad and set a withdrawal limit of $1,000 a week for accounts denominated in foreign currency, according to a statement issued Sunday by the Association of Banks in LebanonPresident Michel Aoun appealed to Arab neighbors on Tuesday for help to revive his country’s economyFranklin Templeton said the government will have to renegotiate its debt to stave off an economic collapseEgypt cut its main interest rates by a full percentage point with inflation at the lowest in almost a decade. The deposit rate was reduced to 12.25% and the lending rate to 13.25%Mexico cut the benchmark rate for a third consecutive meeting after inflation slowed to target and economic growth stumbledTwo German citizens were detained by Hong Kong police amid the continuing protests, Deutsche Welle reported, citing an official at Germany’s foreign ministry. The two Germans are receiving assistance from the country’s consulate in Hong Kong, according to the report.Chinese President Xi Jinping called an end to violence Hong Kong’s “most urgent task,” as a scuffle involving the city’s justice minister and the second protest-related death in a week heightened tensions in the paralyzed financial centerHong Kong officials and Chinese state media warned of consequences if violence continuedChilean stocks and the peso rallied the most in a decade on optimism an agreement over a new constitution will help end protests and riots that threatened to upend the country’s economyThe Chilean peso slumped to a record low amid a wave of social unrest and investor concern about a new constitutionCentral bank announced a $4 billion swap program to ease liquidityChile’s government is willing to increase the minimum pension by more than a proposed 20% in response to the biggest civil unrest in a generation, President Sebastian Pinera said in a televised address late SundayOptimism about a trade deal between the U.S. and China encouraged investors to add $1 billion to emerging-market exchange-traded funds in the week ended Nov. 8, the biggest weekly inflow since Feb.Asia:China wants to balance functionality with concerns about anonymity as it works toward launching a digital version of the yuan, according to an official from the People’s Bank of ChinaForeign companies continue to invest more in China even after Trump called on U.S. firms to look elsewhere, as the rising spending power of 1.4 billion people proves too hard to resistSouth Korea will try to achieve economic growth of more than 2.2%-2.3% next year by providing momentum for an economic rebound, Finance Minister Hong Nam-ki saidBank of Korea board member Lim Ji-won said global data in the past few months show the manufacturing slump is easing slightlyHoldings of overseas alternative assets such as real estate, infrastructure, private equity and debt, and hedge funds by investors rose to at least about 201 trillion won ($172 billion) this year, a record, according to data compiled by Samsung Securities Co. and Korea Investors Service Inc.The U.S. and key allies are seeking to hold a United Nations Security Council debate on North Korea’s human rights record after failing to do so last year, according to diplomats familiar with the discussionsIndia’s trade deficit widened less than estimated last month, as a third-straight month of decline in exports offset a sharp plunge in imports amid weak global demand conditions.The country’s retail inflation quickened for the third straight month in October, breaching the central bank’s 4% medium-term target and possibly slowing the pace of monetary policy easingThe nation is considering changes to its dividend distribution tax that will raise returns for investors, according to people familiar with the matter, as authorities try to revive foreign fund inflowsFactory output shrank to the lowest level in eight years, as a sharp fall in capital goods production underlined weak demand in Asia’s third-largest economyIndia plans to reduce its stake in Indian Oil Corp. to below 51% while ensuring the government and state-run companies retain control of the nation’s largest oil refiner, people with knowledge of the matter saidArcelorMittal won approval from India’s top court to complete its $5.8 billion purchase of a bankrupt steel mill, clearing the way for tycoon Lakshmi Mittal to enter the world’s second-biggest marketIndonesia’s customs cleared nine firms to export nickel ore after briefly suspending shipments for inspection, according to Heru Pambudi, director general of Customs and ExciseExports fell 6.1% in October from a year earlier, while trade balance came in at surplus of $161 millionSoutheast Asia’s largest economy may post higher-than-expected budget deficit next year as govt seeks to maintain growth momentum amid lower revenue, according to Finance Minister Sri Mulyani IndrawatiThai Finance Minister Uttama Savanayana said he plans to issue measures to help boost the economy, while adding past steps didn’t do enough for small businesses. The economy will continue to face high risks next year, so the government needs to be well-prepared, he also saidThailand will try to find new markets for products affected by the suspension of some trade preferences under the U.S.’s Generalized System of Preferences, Commerce Minister Jurin Laksanawisit said. The two nations will speak on the issue in late NovemberMalaysia’s economic growth eased in the third quarter to its slowest pace in a year amid declining exports and weaker factory outputA Malaysian judge ordered ex-premier Najib Razak to defend himself against all charges in the trial involving a former unit of troubled state-owned fund 1MDBThe Philippines central bank kept its key rate unchanged at 4%, opting for what it described as a “prudent pause” to monitor how previous easing steps are filtering through to the economy. It trimmed its 2019 inflation forecast to 2.4% from 2.5%Business process outsourcing may grow between 3.5%-7.5% annually from 2020 to 2022, IT and Business Process Association of the Philippines President Rey Untal saidThe candidate representing Taiwan’s China-friendly opposition party in January’s presidential race called for free elections in Hong KongPresident Tsai Ing-wen on Sunday named former premier Lai Ching-te as her running mate in January’s electionEMEA:Istanbul may sell at least $500 million of bonds to fund six metropolitan projects, people with direct knowledge of the plan said, in what would be Turkey’s first municipal debt issuance in 27 yearsTurkish industrial output expanded on an annual basis for the first time in 13 months in September, a sign that the economy is finding its footing after a recession last yearPresident Recep Tayyip Erdogan said interest rates will fall further and again boasted that his firing of the central bank governor has permitted a sharp drop in borrowing costs since JulyPoland’s Premier Mateusz Morawiecki picked Tadeusz Koscinski, a former banker, to become the country’s fifth finance minister in as many months as the ruling Law & Justice party shuffles its cabinet after last month’s electionTens of thousands of Czechs thronged the streets of Prague in one of the largest anti-government protests in the country since the fall of communism, calling on their billionaire prime minister to step downRussian economic growth accelerated to 1.7% in the third quarter, the fastest pace this year, after the central bank delivered four consecutive rate cutsRussia is planning to cut the dollar’s share in its $125 billion sovereign-wealth fund, following a major move last year out of U.S. assets by the central bankThe nation skipped a weekly sale of fixed-coupon bonds for the first time since December, citing rising market volatility as bond yields climbedEgypt sold its longest Eurobond on record, part of a $2 billion deal, as it seized on appetite for riskier assets and spread out the burden of servicing its debtMorocco hired a consortium to arrange a euro-denominated bond offering of 12- or 20-year maturity to investors, according to a person familiar with the matterSaudi Aramco’s gigantic initial public offering could see retail investors returning to the Riyadh stock exchange as local individuals snap up shares in the world’s most profitable companySaudi Arabia put a preliminary valuation on its state-owned oil giant Aramco of between $1.6 trillion and $1.71 trillion, short of the $2 trillion target set by Crown Prince Mohammed bin Salman in 2016Efforts to resolve the standoff between Qatar and a Saudi-led bloc are gathering momentum, with an upcoming soccer tournament in Doha helping to pave the way for a possible breakthrough, according to a Gulf official with knowledge of the matterIsrael’s economy accelerated thanks to both public and private spending, overcoming disruptions in world trade that have threatened local growthSouth African retail sales climbed at the weakest pace in six months in SeptemberGhana will ramp up spending by a fifth next year and plans to raise as much as $3 billion in international markets as it prepares for an election in 13 monthsYields on Nigeria’s one-year Treasury bills fell on Thursday to the lowest since April 2016, while demand for three-month debt surged to a record as local funds pile into the debt after the central bank restricted their access to its higher-yielding securitiesKenya’s 47 counties can begin raising state-guaranteed debt next year, potentially heaping more liabilities on the over-leveraged East African economyLatin America:Chile took a major step toward solving the social crisis that has convulsed the nation for the past month when lawmakers from almost all the parties agreed early on Friday to a mechanism to rewrite the constitutionChile’s government said that it backed plans to rewrite the constitution, weakening the peso by almost 4% in the week, the worst performance among all currencies in emerging marketsGovernment has also said it would pull $1 billion from its sovereign wealth fund in the next few days to help finance increased spendingThe $4 billion credit line opened by Chile’s central bank Thursday fueled a rise in the peso forward marketBrazil launched an employment program that could generate 1.8 million new jobs by 2022, according to an estimate by the Economy MinistryPresident Jair Bolsonaro confirmed he will leave the PSL party and create a new one called “Aliança pelo Brasil,” meaning “Alliance for Brazil”After a pension reform became law this month, Bolsonaro’s administration is now prioritizing measures that increase control over the federal budgetBrazil’s economy likely grew in the third quarter according to a key gauge, indicating a record-low policy rate and government measures are buttressing demandRetail sales notched the fifth straight monthly increase in SeptemberFormer President Luiz Inacio Lula da Silva, who left jail earlier this month after a Supreme Court decision, used a more radical tone in his speechesThe hacker behind a cyberattack that has crippled Petroleos Mexicanos’s computer systems is hoping to squeeze almost $5 million out of the company and appears to have set a deadline of Nov. 30Bolivia’s Evo Morales accepted Mexico’s offer of political asylum, thrusting leftist President Andres Manuel Lopez Obrador’s government into the center of a crisis that has split Latin America’s government allegiancesOpposition lawmaker Jeanine Anez declared herself interim president as the ouster of Morales plunged the nation into a constitutional crisis, triggering a clash between the police and Morales supporters in La PazNew finance minister Jose Parada ruled out changes in the level of the currencyArgentine President-elect Alberto Fernandez is preparing to task the country’s central bank with trying to boost the crisis-torn economy through a weak exchange rate, according to two people with direct knowledge of the strategyFernandez said he will probably announce the economic team on Dec. 10 when he takes officeFernandez said he’ll review the government’s spending plans for 2020 and suggested his predecessor’s draft budget was faultyArgentina bondholders are so worried that the country’s new leader may default that they’ve pushed yields on local notes due two days after his Dec. 10 inauguration to an ear-popping 100%Three hedge funds are demanding more than 384 million euros ($425 million) from Argentina in a U.K. lawsuit that alleges the country restated economic figures to avoid paying out on securities tied to its growthArgentina is lifting controls on crude oil and fuel prices, leaving drillers and refiners to work out how to get back to market levels, according to two people familiar with the matterColombia’s economy grew at its fastest pace in four years as migration from Venezuela and accelerating credit growth boost consumer demandParaguay plans to issue a global bond for approximately $500 million in the first quarter of next year, according to Finance Minister Benigno Lopez\--With assistance from Selcuk Gokoluk, Colleen Goko and Carolina Wilson.To contact Bloomberg News staff for this story: Yumi Teso in Bangkok at yteso1@bloomberg.net;Netty Ismail in Dubai at nismail3@bloomberg.net;Aline Oyamada in Sao Paulo at aoyamada3@bloomberg.netTo contact the editors responsible for this story: Tomoko Yamazaki at tyamazaki@bloomberg.net, Karl Lester M. Yap, Joanna OssingerFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Goldman Sachs to Pay $20 Million in Bond-Rigging Settlement

    Goldman Sachs to Pay $20 Million in Bond-Rigging Settlement

    (Bloomberg) -- Goldman Sachs Group Inc. agreed to pay $20 million to settle an investor lawsuit accusing traders at the bank, along with 15 other financial institutions, of rigging prices for bonds issued by Fannie Mae and Freddie Mac.As part of the settlement, disclosed Friday in a court filing, Goldman Sachs will cooperate with investors in their case against the other banks. The firm also agreed to make changes to its antitrust-compliance policies related to bond trading. A federal judge in Manhattan must approve the settlement before it can take effect.Investors sued after Bloomberg reported in 2018 that the U.S. Department of Justice was investigating some of the world’s largest banks for conspiring to rig trading in unsecured government bonds.Goldman Sachs has turned over 71,000 pages of potential evidence, including four transcripts of chat-room conversations among its traders and some from Deutsche Bank AG, BNP Paribas SA, Morgan Stanley and Merrill Lynch & Co., according to court papers filed Friday. The bank agreed to provide additional help, including deposition and court testimony, documents and data related to the bond market.Goldman Sachs isn’t the first to resolve the civil claims. In September, Deutsche Bank agreed to settle for $15 million. First Tennessee Bank and FTN Financial Securities Corp. agreed to a $14.5 million settlement later in September.Among the firms remaining as defendants in the case are Credit Suisse AG, Barclays PLC and Citigroup Inc.The case is In re GSE Bonds Antitrust Litigation, 19-01704, U.S. District Court, Southern District of New York (Manhattan).To contact the reporter on this story: Bob Van Voris in federal court in Manhattan at rvanvoris@bloomberg.netTo contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Steve StrothFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Investing.com

    Stocks - Applied Materials, Grubhub, J.C. Penney Surge Premarket

    Investing.com - Stocks in focus in premarket trading on Friday:

  • Bonds Aren’t Believers in a Synchronized Upswing

    Bonds Aren’t Believers in a Synchronized Upswing

    (Bloomberg Opinion) -- The global bond market rallied for a second consecutive day on Thursday in an awkward development for the growing chorus of voices that have cropped up the last few weeks contending that the synchronized global slowdown was over. From China to Germany, and from Cisco Systems Inc. to freight shipments, the latest data show  it’s too soon to turn optimistic.In China, industrial output rose 4.7% in October from a year earlier, below the median estimate of 5.4%. Germany did post a surprise expansion in its gross domestic product for the third quarter, but that came with plenty of caveats. For one, the increase was only 0.1%, and the contraction for the second quarter was deeper than initially reported — negative 0.2% versus negative 0.1%. In the U.S., economists were passing around the latest Cass Freight Index for October, which fell 5.9% to mark its 11th consecutive year-over-year decline. This gauge has been around since 1995 and tracks freight volumes and expenditures by hundreds of companies in North America conducting $28 billion of transactions annually. More important, the compilers of the index noted in the latest survey that the index “has gone from ‘warning of a potential slowdown’ to ‘signaling an economic contraction.’” Cisco is not in the freight business, but comments by Chief Executive Officer Chuck Robbins late Wednesday after the computer company released fiscal second-quarter results echoed the sentiment in the freight industry. “Just go around the world and you see what’s happening in Hong Kong, you look at China, what’s happening in D.C., you’ve got Brexit, uncertainty in Latin America,” he said on a conference call with investors and analysts. “Business confidence suffers when there’s a lack of clarity, and there’s been a lack of clarity for so long that it’s finally come into play.”Maybe the global economy isn’t worsening, but it’s too soon to say an upswing is underway. Despite the sell-off in the bond market since September, yields are still showing caution. Yields on bonds worldwide as measured by the Bloomberg Barclays Global Aggregate Index stand at 1.45%, which is closer to its all-time low of 1.07% in 2016 than last year’s high of 2.27% in November.AWASH IN MORE DEBTThe Institute of International Finance came out with its quarterly look at the mountain of global debt, concluding that it rose by about $7 trillion in the first half of the year to a record of just more than $250 trillion. That increase is more double the $3.3 trillion expansion for all of last year. It pegs global debt, which it sees expanding to $255 trillion by the end of the year, at a lofty 320% of global GDP. It’s no surprise that the world is awash in debt, but yields show there seems to be a dearth of it for the public because of massive purchases by central banks. As of October, the collective balance-sheet assets of the Federal Reserve, European Central Bank, Bank of Japan and Bank of England stood at 35.7% of their countries’ total GDP, up from about 10% in 2008. Still, this is no time to be complacent. The IIF points out that much of the growth in debt has come in emerging markets, which is generally considered riskier than that of developed economies and where central banks are not doing things like quantitative easing. This could become an issue relatively quickly; the IIF pointed out that $9.4 trillion of bonds and syndicated loans from emerging markets come due by the end of 2021.CORPORATE CASH SHRINKSThe latest doubts about the strength of the economy kept the S&P 500 Index little changed for a second consecutive day. Perhaps that’s for the better because falling interest rates and bond yields are perhaps the single-biggest reason equities are up 23.4% this year in the absence of earnings growth. The second is probably share repurchases. But a new report from Societe General SA raises concern that the cash companies use to fund those buybacks is being depleted. “A boon for U.S. share buybacks” has left companies with less cash in their coffers, Societe Generale strategists Sophie Huynh and Alain Bokobza wrote in a report. Cash and money-market investments held by companies in the S&P 500 peaked in 2018’s first quarter on a per-share basis before falling 5.3% through the third quarter of this year, according to Bloomberg News’s David Wilson. S&P 500 companies have bought back the equivalent of 22% of their market value since 2010, the Societe Generale strategists noted in their report.CHILEAN CRISIS ENTERS NEW PHASEThe chaos in Chile, long known as the safest bet in Latin America, has become so bad that not even direct intervention by the nation’s central bank was able to reverse the slide in the peso. The currency fell about 1% Thursday, bringing its slide to 11.4% since mid-October. That’s the worst of the 31 major currencies tracked by Bloomberg and more than five times the next biggest loser, the Hungarian forint. What should have investors worried is that the peso depreciated even after the central bank announced a $4 billion currency swap program to ease liquidity in the market amid the worst civil unrest in a generation. “I don’t think it will help stop the sell-off in any way,” Brendan McKenna, a currency strategist at Wells Fargo, told Bloomberg News in reference to the swaps program. “There has to be some breakthrough on the political front for the currency to stabilize.” Foreign investors have been especially rattled since the government said Sunday that it backed plans to rewrite the constitution in response to four weeks of riots and protests in support of better pensions, wages, education and health care. If that were to happen, it’s possible the government would swing too far to the populist left to the detriment of the economy. FOLLOW THE CLIMATE CHANGE MONEYDespite the overwhelming evidence about climate change, there is still an alarming number of deniers. But if it was really all a big hoax or overblown, then why are the world’s biggest, most influential investment firms steering away from areas that are likely to be hit the hardest, such as the coasts? Goldman Sachs Group Inc. is considering real estate markets including Denver; Austin, Texas; and Nashville, Jeffrey Fine, a managing director at the firm’s merchant-banking division, said Thursday at a conference hosted by the NYU School of Professional Studies. Fine may not have specifically cited climate change, but according to Bloomberg News’s Gillian Tan, he did note that more companies and young people are moving away from the coasts. The Fed held its first conference on climate change last week in San Francisco, with one central bank official saying it has the potential to “displace people permanently” amid damaging wildfires in California and storms punishing the Eastern Seaboard. About 3 billion people — or some 40 percent of the world’s population — live within 200 kilometers (124 miles) of a coastline, according to Bloomberg News. It’s projected that by 2050 more than 1 billion will live directly at the water’s edge.TEA LEAVESThe idea that the U.S. consumer was strong and carrying the economy took a hit a month ago when Commerce Department data showed that retail sales in September fell unexpectedly. The 0.3% decline from August was directly opposite the 0.3% advance expected based on the median estimate of economists surveyed by Bloomberg. That’s why Friday’s update from the government on October retail sales is so critical, especially heading into the holiday sales season. Economists are calling for a 0.2% rebound. Bloomberg Economics isn’t so optimistic, saying that decelerating wage growth suggests household demand will moderate. It is forecasting no change in spending. Although the headline number will get the attention, the smart money will be looking at sales among a control group that are used to calculate GDP and exclude food services, auto dealers, building-material stores and gas stations. By that measure, sales are seen rising 0.3% from no change in September.DON’T MISS Stock Investors Could Use a Refresher on the Basics: Nir Kaissar You Care About Earnings? The Stock Market Doesn’t: John Authers Too Many Young American Men Still Aren’t Working: Justin Fox Brazil’s Politics and Economics Are Growing Apart: Mac Margolis Matt Levine's Money Stuff: You Can Buy Almost All the StocksTo contact the author of this story: Robert Burgess at bburgess@bloomberg.netTo contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Robert Burgess is an editor for Bloomberg Opinion. He is the former global executive editor in charge of financial markets for Bloomberg News. As managing editor, he led the company’s news coverage of credit markets during the global financial crisis.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Mexico Cuts Key Interest Rate for Third Straight Time

    Mexico Cuts Key Interest Rate for Third Straight Time

    (Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Apple Podcast, Spotify or Pocket Cast.Mexico’s central bank cut the benchmark interest rate in a split vote among board members after inflation slowed to target and growth stumbled.The central bank, led by Governor Alejandro Diaz de Leon, voted 3-2 to reduce the key rate by a quarter point to 7.50%, in line with the estimate of 17 of 26 economists surveyed by Bloomberg. The other two board members sought a half-point cut to 7.25%, in line with nine economists’ forecasts.Banxico, as the central bank is known, has every reason to extend its easing cycle, according to economists, amid very subdued inflation and growth and a stable peso. The only debate is over how quickly and how extensively it will cut, and today’s quarter-point reduction points to a more conservative stance.“They’re being prudent,” said Marco Oviedo, chief Latin America economist at Barclays. “The discussion isn’t about whether to cut but by how quickly.” Oviedo sees another rate reduction in December.Banxico said in the statement accompanying its decision that both inflation and growth for this year and next will likely be below previous forecasts, although core inflation has remained persistent.Interest rate cuts may be more important than ever now, as Mexican growth continues to disappoint both investors and the nation’s president. Andres Manuel Lopez Obrador has brandished the strong peso as a weapon against critics who worry he’s scaring investors. But an easing cycle that weakens the exchange rate and makes exports more attractive could help Mexico’s economy even more.“Banxico is being relatively dovish and signaling it will keep cutting rates, but in a cautious manner,” Delia Paredes, an economist at Grupo Financiero Banorte, said before the decision.In the previous decision, board members Gerardo Esquivel and Jonathan Heath, both nominated by Lopez Obrador, had voted for a deeper half-point cut than the majority.(Updates with analyst comment starting in fourth paragraph.)To contact the reporter on this story: Nacha Cattan in Mexico City at ncattan@bloomberg.netTo contact the editors responsible for this story: Daniel Cancel at dcancel@bloomberg.net, ;Juan Pablo Spinetto at jspinetto@bloomberg.net, Robert JamesonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Bloomberg

    Powell Satisfied With Current Fed Interest Rates But Flags Risks

    (Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Apple Podcast, Spotify or Pocket Cast.Federal Reserve Chairman Jerome Powell stuck to his view that interest rates are probably on hold after three straight reductions, while signaling that the U.S. central bank could resume cutting if the growth outlook falters.“We see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook,” Powell told the congressional Joint Economic Committee Wednesday in Washington. “However, noteworthy risks to this outlook remain.”Powell, whose comments largely echoed his message on Oct. 30 after the Fed’s third rate cut this year, said slowing global growth and trade developments pose “ongoing risks.” He added that persistently low inflation could lead to an “unwelcome” slide in the public’s longer-run expectations of inflation.Powell said the Federal Open Market Committee cut the policy rate, which is now in a range of 1.5% to 1.75%, to support growth and move inflation back to the 2% target. He said the committee was prepared to respond to a “material reassessment” of its outlook, and the tone of his remarks suggest that downside risks for now outweigh the possibility of economic overheating.Explaining why wages haven’t moved up with the unemployment rate at 3.6%, Powell said it could be a sign that there is still slack in the labor market. “It also may be that the neutral rate of interest is lower than we have been thinking and that therefore our policy is less accommodative than we have been thinking. We are letting the data speak to us.”The comments suggest that the rate cuts this year weren’t entirely about insuring against a global slowdown, but also recalibrating interest costs to an economy where inflation has remained stubbornly low.High Bar“We continue to hear from him that they can run the economy with lower rates of unemployment than they thought they could,” said Michael Gapen, chief U.S. economist at Barclays Plc. “That underscores that they expect there to be a high bar to raising rates.”Asked if he meant to signal that policy was on hold through next year, Powell responded “I wouldn’t say that at all” before repeating the line from his opening remarks on policy likely to remain appropriate as long as the economy stays on track.“We do think monetary policy is in a good place, but we’re going to be watching very carefully incoming data,” he said.Yields on 10-year Treasury notes were steady around 1.87% following the testimony while U.S. stocks were higher in New York trading.Powell and the Fed have been relentlessly criticized by President Donald Trump, who has blamed the central bank’s policies, rather than the U.S.-China trade war, for a slowdown in the U.S. economy as he ramps up his 2020 re-election campaign.“We’re paying actually high interest. We should be paying by far the lowest interest,” Trump said Tuesday in New York, complaining that by shunning the negative interest rates deployed by other central banks, the Fed “puts us at a competitive disadvantage.”Negative RatesPowell told lawmakers that politics played no role whatsoever in the Fed’s policy decisions, which were based on the analysis of the data, adding that negative rates “would certainly not be appropriate in the current environment.”U.S. economic data have continued to show strength among households and financial conditions have eased with stocks touching record highs on Wall Street this month. Consumer sentiment improved for a third month in November, according to the University of Michigan’s preliminary sentiment index, while employers added 128,000 new jobs in October. Powell said the Fed expected some easing in the pace of job gains after last year’s strong pace.Manufacturing and business investment continue to lag. A gauge of U.S. manufacturing signaled the sector contracted for a third straight month with the weakest production level since the last recession.“The outlook is still a positive one. There is no reason this expansion can’t continue,” Powell said. “There is a lot to like about this rare place of the 11th year of an expansion and we’re certainly committed to doing what we can to extend it.”\--With assistance from William Edwards and Christopher Condon.To contact the reporter on this story: Craig Torres in Washington at ctorres3@bloomberg.netTo contact the editors responsible for this story: Alister Bull at abull7@bloomberg.net, Vince GolleFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Benzinga

    Barclays Starts Coverage Of US Specialty Retail

    Barclays is out Neutral on U.S. specialty retail, apparel and e-commerce stocks on the basis of an an improving tariff backdrop that's offset by sector-wide inventory build, negative mall traffic and general ...

  • China's No. 1 University Has a Big Debt Problem

    China's No. 1 University Has a Big Debt Problem

    (Bloomberg Opinion) -- A crown jewel of President Xi Jinping’s Made in China 2025 plan is faltering.Tsinghua Unigroup Co. is the business arm of the prestigious Tsinghua University, Xi’s alma mater. The company has been trying to establish itself as a leader in China’s nascent memory-chip industry since 2015, when it famously tried to acquire stakes in U.S. rivals Micron Technology Inc. and Western Digital Corp. Both advances were rejected amid concerns that U.S. regulators wouldn’t approve the deals on national-security grounds. Rebuffed abroad, Unigroup resolved to become a domestic champion and poured its resources into developing flash-memory technology. One of its subsidiaries, three-year-old Yangtze Memory Technologies Co., is already bringing its know-how to production. It’s impressive how fast the unit has developed despite lagging behind rivals in efficiency, Bernstein Research notes.Yet credit investors are getting nervous: Unigroup’s dollar bond due in 2023 has tumbled in recent days, and is now yielding more than 10%. Last week, the chipmaker hurriedly arranged a conference call to reassure investors that its finances were in good order. Surely an asset of such national strategic importance shouldn’t be trading like a junk-rated firm bordering on bankruptcy, management reasoned. A big question hanging over Unigroup is: Who’s its real daddy? As part of China’s university reform, which aims to separate academic institutions from business endeavors, Unigroup’s controlling shareholder Tsinghua Holdings Corp. has attempted to disentangle itself from the company multiple times. The latest rout comes amid a protracted custody battle.Naturally, debtholders shudder every time speculation swirls about Unigroup’s ownership. Last year, its bonds tanked after Tsinghua agreed to sell its shares to an obscure state-owned entity in the second-tier city of Suzhou, only to recover a month later when the university opted for the cash-rich Shenzhen government instead. The bonds plummeted yet again in recent months when Tsinghua abandoned the Shenzhen deal. Then in a conference call last week, Zhao Weiguo, the holding company’s chairman, said Unigroup should remain under the Tsinghua University umbrella, making multiple references to the wishes of the “paramount leader.” For anyone in doubt, that’s Xi.Figuring out who’s holding the purse strings is particularly important for Unigroup, because like all chipmakers it needs billions of dollars in capital outlays. Industry leader Samsung Electronics Co., for example, splashed out about $25 billion annually in capital expenditure over the past five years. Yangtze Memory, Unigroup’s flash-memory business, has already spent more than 20 billion yuan ($2.86 billion) on a new plant in Wuhan and earmarked $30 billion in total spending there. The key difference is that, unlike Samsung, the Yangtze subsidiary is behind on technology and unlikely to break even until 2022 at the earliest, estimates Barclays Plc. Money has to come from the outside. Sure, Unigroup is getting financial support from China’s various venture-capital-like guidance funds and has a big credit line from China Development Bank. But investors worry that’s not enough. Obscure state-owned entities, and even Tsinghua University itself, don’t have pockets deep enough to bankroll Unigroup as it ramps up production, they wager. Revenue at Unigroup rose 7.5% from a year earlier in the first half, but its Ebitda earnings tumbled 27% to a peanut-sized 1.5 billion yuan, driven by a sharp increase in research expenses. As of June, the company sat on 39 billion yuan of cash but had 58 billion yuan of interest-bearing debt due in the year ahead. By now, conspiracy theories abound explaining Tsinghua's decision to scrap its deal with Shenzhen, often considered China’s Silicon Valley. One explanation could be ego: Why would Xi allow his alma mater’s prized asset to be controlled by a mere local state-owned entity?Investors also question whether geopolitics is at play. If Tsinghua offloaded its stake to Shenzhen, Unigroup would become a bona fide state owned enterprise, making it vulnerable to operations restrictions — from intellectual property transfer to preferential taxation — if China strikes a broader trade deal with the U.S. If Unigroup remains under the umbrella of a non-profit university, on the other hand, it could still develop its chip capacity within a gray zone. The naive might argue that Beijing can’t possibly let Unigroup go under. That may well be the case; but as I’ve written, an unhealthy undercurrent is forming in China’s bond market. Increasingly, distressed companies are pushing for quiet deals with institutional investors to delay repayment dates. This is perhaps why investors got even more nervous when news surfaced that Unigroup had asked Credit Suisse Group AG for its help to amend and extend some bank loans. Pinched by the trade war, China is now eager to become self-sufficient, and semiconductors are certainly a good place to start. Last year, China’s trade deficit in chips continued to widen to $228 billion, more than double levels from a decade earlier. But if you think Tsinghua Unigroup will emerge a clear winner from this, think again. As we’ve seen in the past, national service doesn’t necessarily get you a glittering credit score, with local government financing vehicles and regional banks alike now languishing with junk ratings. Unigroup investors would do well to remember that they can't take Xi’s school spirit to the bank. To contact the author of this story: Shuli Ren at sren38@bloomberg.netTo contact the editor responsible for this story: Rachel Rosenthal at rrosenthal21@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shuli Ren is a Bloomberg Opinion columnist covering Asian markets. She previously wrote on markets for Barron's, following a career as an investment banker, and is a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Markets Take the Under on Trump’s Economic Speech

    Markets Take the Under on Trump’s Economic Speech

    (Bloomberg Opinion) -- The global stock market drifted lower on Monday, posting its biggest decline in more than three weeks. Yes, there’s still plenty of time for equities to recover and gain for a sixth consecutive week, which would match their longest winning streak since they advanced for 10 consecutive weeks over the course of late 2017 and early 2018. But doing so may hinge on a critical event Tuesday. Even with the modest decline, the MSCI All-Country World Index is still up 19% this year. The surge in recent weeks is due largely to optimism that the U.S. and China are close to reaching an agreement on “phase one” of a broad trade deal. It doesn’t matter that the details are likely to be modest; what matters is that it would signal that the trade war isn’t worsening. That’s why President Donald Trump’s address to the Economic Club of New York on Tuesday is so critical. No one is quite sure which Trump will show up. Will it be the one who in recent weeks has trumpeted progress in trade talks, or will it be the one who has said that the U.S. hasn’t agreed to a rollback of tariffs on China, which is what the markets truly want? This is no small matter for investors. Various surveys have shown that trade uncertainty is the primary risk facing markets. In that sense, whatever Trump says on Tuesday has the potential to either ratify the rally or bolster the case that it’s built on little more than hope. And as everyone in markets learns on their first day in the business, hope isn’t a strategy. “Markets have been skittish waiting for any concrete information about the trade talks,” Matt Forester, the chief investment officer at BNY Mellon’s Lockwood Advisors, told Bloomberg News. At 15 times forecast earnings for the following year, the MSCI is trading at its most expensive level since the start of 2018.Trump’s talk is not the only big event for markets this week. Federal Reserve Chairman Jerome Powell will address the Joint Economic Committee of Congress on Wednesday, the same day as the start of public impeachment hearings against Trump. The U.S. Labor Department will also provide an update on inflation for October. The week ends with data on U.S. retail sales for October, which economists hope will be a reversal from September’s big miss to the downside. But as already stated, hope has no place in markets.THE BOND GAME ISN’T OVER YETThe bad news for the bond market is that November isn’t even halfway over and it’s already the worst month for fixed-income investors since April 2018, with the Bloomberg Barclays Global Aggregate Index down 1.40% as of Friday. The good news is that there’s plenty of time for the bond market to rebound. And just as with the stock market, Trump’s appearance at Economic Club of New York —  along with Powell’s testimony — may determine whether the recent sell-off in fixed-income assets is overdone. That’s the short-run prognosis. In a nod to John Maynard Keynes, bonds are dead in the long run anyway. Well, at least according to Moody’s Investors Service they are. The credit ratings company put out a research report Monday saying the rising tide of populism spreading round the world has caused it to turn “negative” on global sovereign credit for 2020. Unpredictable domestic and geopolitical risks along with a push for populist policies that weaken institutions, help slow growth and boost the risk of economic and financial shocks means governments will struggle to address credit challenges, Moody’s wrote. That’s scary, but the major ratings companies aren’t known for their astute political science observations. Yields on 10-year Treasury notes are lower now than when S&P Global Ratings stripped the U.S. of its AAA rating in August 2011.GO BIG OR GO HOMEThe thing about bond sell-offs in recent years is that have tended to be short-lived, thanks largely to central banks. The collective balance sheet assets of the Fed, European Central Bank, Bank of Japan and Bank of England rose to 35.7% of their countries’ total gross domestic product in October from about 10% before the financial crisis, according to data compiled by Bloomberg. And judging by some of the latest moves made by the ECB, bond traders can be a little less worried about a lack of buyers. The ECB started its second round of corporate bond purchases by acquiring in a week an amount that analysts expected it to buy in a month, according to Bloomberg News’s Tasos Vossos. The central bank bought almost 2.8 billion euros ($3 billion) of company debt securities in the week to Nov. 8, according to data released Monday. It was the second-largest weekly purchase figure since the ECB first adopted the strategy, known as quantitative easing, in June 2016. The bank suspended the program last December and restarted it at the beginning of this month as growth flagged across the euro area. It’s unknown whether the faster pace of purchases is in response to the big drop in bond prices and corresponding jump in yields, but it should be comforting to know that the ECB is doing its part to stem the weakness.CHILE GIVES INIt’s becoming routine to see the Chilean peso leading the list of biggest losers in the foreign-exchange market on any given day, and Monday was no exception. The peso weakened 1.72% to a record low, bringing its depreciation since Oct. 18 to 6.39%. To put that into context, the next biggest loser among the 31 major currencies tracked by Bloomberg, the Argentine peso, has dropped just 2.48%. It’s well known by now that the populist movement that Moody’s warned about on Monday has erupted in Chile, where a wave of protests has disrupted the economy and government. The latest move lower in the peso came as the administration of President Sebastian Pinera said it would overhaul the constitution drawn up during the dictatorship of Augusto Pinochet to calm three weeks of mass protests. So why did the peso and Chile’s equity market, which fell 1.52%, take it so harshly? Many people regard the constitution, drawn up under the dictatorship of Pinochet, as the foundation of an economic system that privatized pensions and much of health care and education, a chief grievance of protesters, according to Bloomberg News’s Javiera Baeza and Eduardo Thomson. It also enshrined the strict legal safeguards to private property that are behind Chile’s water privatization, a controversial subject in a country struggling with severe droughts.NATURAL GAS STUMBLESThe natural gas market cares little about trade wars or populism. To traders there, it’s all about the weather. Natural gas futures slid the most since January as forecasts showed that a cold snap descending on the U.S. would peter out by the end of the month, curbing demand at the time of year when consumption of the heating gas usually surges, according to Bloomberg News’s Christine Buurma and Naureen S. Malik. Gas was the worst-performing major commodity Monday, tumbling as much as 6.1%. Temperatures will probably be mostly normal in the eastern half of the country Nov. 21 through Nov. 25 as an autumn chill fades, according to Commodity Weather Group LLC. Beyond the weather, the slide in natural gas underscores how record production from shale basins continues to weigh on the market even as exports soar and the power industry becomes more reliant on the fuel. Without a sustained Arctic chill this winter, stockpiles will remain above normal for the time of year, pressuring prices lower, according to Buurma and Malik. As they point out, hedge funds are adding to the bearish momentum, holding the largest short position since 2015 for the time of year.TEA LEAVESWhen the National Federation of Independent Business said a month ago that its small-business sentiment index for September fell to near the lowest level of  Trump’s presidency, it noted that the part of the gauge measuring “uncertainty” plunged to its lowest since February 2016. “More owners are unable to make a statement confidently, good or bad, about the future of economic conditions,” the group said, with 30% of respondents reporting “negative effects” from tariffs. Don’t expect much improvement when the group provides an update on Tuesday. The median estimate of economists surveyed by Bloomberg is for a reading of 102 for October, little changed from 101.8 in September. Bloomberg Economics points out that small-business activity has been moderating since the last report. Most notably, the ADP private employment survey indicated recently that net hiring has shrunk to half the pace that prevailed last year, to the slowest since 2011.DON’T MISS Buying Stocks at Records Works Until It Doesn’t: Robert Burgess Investors’ Global Turn Depends on Policy Hopes: Mohamed El-Erian Delaying the IPO Process Weakens Capitalism: Stacey Cunningham U.S. Economy Has Recovered, But Labor Market Hasn’t: Karl Smith The 2020 Economy Should Feel a Lot Better Than 2019: Conor SenTo contact the author of this story: Robert Burgess at bburgess@bloomberg.netTo contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Robert Burgess is an editor for Bloomberg Opinion. He is the former global executive editor in charge of financial markets for Bloomberg News. As managing editor, he led the company’s news coverage of credit markets during the global financial crisis.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Financial Times

    Post Office faces new rules on bank services

    Banks are lobbying the Treasury for guarantees that they will not be forced to subsidise the Post Office’s branch network, while the company has reached out to regulators to see if “a more regulated service” would allay their concerns, according to multiple people involved in the discussions. to pull out of a deal that lets its customers withdraw cash from Post Office branches after the Post Office raised its charges, but climbed down after being convinced its participation was crucial to the network.

  • Global Bond Sell-Off Persuades Some Investors to Buy the Dip

    Global Bond Sell-Off Persuades Some Investors to Buy the Dip

    (Bloomberg) -- Recent losses in Treasuries, which crescendoed Thursday into one of the worst days since Donald Trump was elected president, look like a buying opportunity for many investors who have a grim view of the economy’s prospects.And it appears some are pouncing, with traders cashing out bearish wagers and buy-the-dip buyers rushing in. The rekindled interest in the safety of bonds nudged yields on the 10-year, which had climbed to a three-month high of 1.97% on Thursday, down to as low as 1.89% in early European trading Friday before bouncing back to around 1.94%. European bonds rebounded after French and Belgian yields had climbed above 0% Thursday.Signs of progress in U.S.-China trade talks have thrashed bonds for days, and the two countries agreed Thursday to roll back tariffs on each other’s goods if a deal is reached. The Treasury market has seen a huge turnaround since August, when fears that global growth is slowing prompted the biggest monthly rally since 2008.“Sentiment factors have shifted the needle quite quickly from, ‘Oh, it’s the end of the world,’ to ‘Wow, there are no problems,’ and that’s a massive overreaction,” Aberdeen Asset Management’s James Athey said in an interview this week with Bloomberg Television. The sell-off has “absolutely, without question” created a buying opportunity, particularly if the 10-year yield hits 2%, he said.The U.S. is the most attractive government-bond market to own, given that the dollar remains the world’s reserve currency and the Federal Reserve has the most room to cut rates before it gets to zero, “if you believe like I do that we’re headed to a recession,” Athey said.Athey was joined by Barclays Plc, which recommended investors enter long positions in five-year Treasuries, and JPMorgan, who said traders should bank the profits made by shorting their three-year counterparts.Money manager Raymond Lee at Kapstream Capital also expects the sell-off to be contained, saying there’s value in developed markets with positive bond yields such as the U.S.“I don’t expect to see two or three years of rates backing up in a sustained way,” he said in an interview in Singapore. “Yields may bounce around on headlines a bit, but inflation is still contained and rates are likely to stay low.”Option TradersFor some Treasury options traders, the sell-off was reason to scoop up profits on lucrative one-week bets that called the recent climb in yields. The trades were struck last week when the 10-year yield was around 1.70% and netted a profit of more than $40 million as the level breached 1.90% on Thursday.Diminished appetite for government debt is pushing the 10-year yield toward 2%, a level it hasn’t surpassed since Aug. 1. It’s also sent yields on French and Belgian 10-year securities above zero for the first time in months.Some are suggesting the sell-off hasn’t gone far enough. Bond valuations “still look rich,” particularly in Europe where negative yields are pervasive, said Scott Thiel, chief fixed-income strategist for BlackRock Investment Institute.As Athey sees it, trade policy wasn’t the biggest factor behind broader worldwide weakness in the past 12 to 18 months. Instead, China is undergoing a secular shift in the pace and make up of its growth that leaves the country “less impactful” on the global economy. There’s “really not much left in the engine of global economic growth at this stage,” he said.(Updates yield levels.)\--With assistance from Ruth Carson and John Ainger.To contact the reporters on this story: Vivien Lou Chen in San Francisco at vchen1@bloomberg.net;Edward Bolingbroke in New York at ebolingbrok1@bloomberg.netTo contact the editors responsible for this story: Benjamin Purvis at bpurvis@bloomberg.net, Nick Baker, Boris KorbyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • U.S. Yields Soar to Three-Month High as Bets on Fed Cuts Slashed

    U.S. Yields Soar to Three-Month High as Bets on Fed Cuts Slashed

    (Bloomberg) -- Treasuries tumbled Thursday as optimism about the prospect of a trade deal dented demand for bonds globally and led investors to trim bets on further Federal Reserve rate cuts.Signs of progress in U.S.-China trade talks helped push the 10-year Treasury yield up as much as 14 basis points, at one stage putting it on track for its biggest daily jump since Nov. 9, 2016. The yield reached 1.97%, a level unseen since early August, before paring its climb to around 1.92%. The 30-year rate topped 2.44%, also a three-month high, as the government auctioned $19 billion of the maturity.At the short-end, traders now doubt that the Fed will ease again at any point in the next two years. Policy makers have been signaling a pause after cutting rates for the third straight meeting in October, but traders had still been factoring some degree of easing as trade friction festered.Now, with apparent relief on that front, “we have a big shift in the 2020 outlook,” said Tom Simons, a money-market economist at Jefferies. “Long-end yields are blowing up, but look at fed funds futures too -- cuts aren’t in the picture any more.”In Europe, rates on benchmark 10-year French and Belgian securities climbed back above 0% for the first time in months, while globally the stock of bonds with sub-zero yields has shrunk to around $12.5 trillion, from about $17 trillion in August.The current mood is a stark contrast to a few months ago, when investors were willing to accept negative yields to insulate their portfolios from the economic harm of the trade war.With yield curves steepening of late, the market is signaling optimism that progress on the trade front and this year’s Fed rate cuts may have helped stave off a U.S. recession.The cheerier economic outlook is a threat to the Treasury market’s top-performing trade. U.S. government debt due in a decade or more has returned about 16% this year through Nov. 6, on pace for its biggest annual gain since 2014, according to a Bloomberg Barclays index. But the performance is now faltering, with the measure extending declines to a third straight month.\--With assistance from Tasos Vossos, James Hirai and Benjamin Purvis.To contact the reporters on this story: John Ainger in London at jainger@bloomberg.net;Katherine Greifeld in New York at kgreifeld@bloomberg.net;Vivien Lou Chen in San Francisco at vchen1@bloomberg.netTo contact the editors responsible for this story: Paul Dobson at pdobson2@bloomberg.net, William Shaw, Mark TannenbaumFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Lebanon Warned on Default and Recession as Its Reserves Decline

    Lebanon Warned on Default and Recession as Its Reserves Decline

    (Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Pocket Cast or iTunes.Lebanon received some of the starkest warnings yet that a default and a deeper recession are increasingly a possibility as protests rock the nation.Moody’s Investors Service on Tuesday downgraded Lebanon deeper into junk for a second time this year, reflecting “the increased likelihood” of what may constitute a default under its definition. The World Bank, which earlier projected a small recession in 2019, now expects it “to be even more significant due to increasing economic and financial pressures.”Lebanon is in dire financial straits just as it succumbs to political paralysis and protests grip the country for a third week. The outcry already prompted the resignation last month of Prime Minister Saad Hariri. But the president has yet to set a date for the start of binding parliamentary consultations to name a new premier, raising concerns the country will be unable to implement measures urgently needed to avert economic meltdown.“The politics has the most attention, but economy has the most risks,” Saroj Kumar Jha, the World Bank’s regional director, said after a meeting with Lebanese President Michel Aoun on Wednesday. “With every passing day, the situation is becoming more acute and this would make recovery extremely challenging.”Lebanon has never defaulted on its obligations despite straining under one of the world’s biggest debt burdens, but the country has seen its credit risk soar as confidence crumbles in the government’s ability to cope with distress.Investors have turned away from Lebanon’s debt despite a package of emergency measures rolled out in October. Its Eurobonds are the world’s worst performers this year after those of Argentina. Their average yield has doubled to 21% since the start of 2019, according to a Bloomberg Barclays index.The nation’s currency peg, in place for more than two decades, is also coming under pressure as local businesses struggle to access dollars from banks at the official rate. After reopening last Friday following two weeks of closures, banks tightened informal restrictions on money transfers that were in place prior to the unrest, in an effort to curtail capital flight.Moody’s lowered Lebanon’s credit rating one level to Caa2 -- the fourth-lowest junk grade -- and said it remains on review for downgrade. Lebanon’s central bank retains a “usable foreign exchange buffer” of only about $5 billion to $10 billion, according to Moody’s. Just over a month ago, the rating company said its usable holdings were no less than $6 billion.Without new net inflows, the stockpile is now likely to be depleted by the government’s looming payments on external debt, estimated at $6.5 billion this year and next, Moody’s said.In an effort to boost liquidity and stave off possible downgrades, Lebanon’s central bank this week instructed local lenders to raise their capital by 20% by next June.Earlier, it also agreed to slash $2.9 billion in interest payments on its holdings of local currency-denominated government debt by waiving coupon payments. The proposal was part of a sweeping package of reforms that aimed to lower the budget deficit to 0.6% of gross domestic productProtesters are meanwhile keeping up the pressure on government officials as students led the demonstrations Wednesday, especially in the capital and outside state entities including the Education Ministry, the Judicial Palace and the electricity company. Thousands have been on the streets, demanding the resignation of a political class that they say has left the country on the verge of bankruptcy.The World Bank warned of the steep cost the crisis could inflict, saying poverty could rise to 50% should there be no immediate solution and if the economic predicament worsens. A third of the Lebanese were estimated to have been in poverty in 2018.“In the absence of rapid and significant policy change, a rapidly deteriorating balance of payments and deposit outflows will bring GDP growth to or below zero, further stoking social discontent, undermining debt sustainability and increasingly threatening the viability of the peg,” Moody’s analyst Elisa Parisi-Capone said.\--With assistance from Paul Wallace and Dana El Baltaji.To contact the reporters on this story: Justin Villamil in Mexico City at jvillamil18@bloomberg.net;Dana Khraiche in Beirut at dkhraiche@bloomberg.netTo contact the editors responsible for this story: Carolina Wilson at cwilson166@bloomberg.net, Paul Abelsky, Amy TeibelFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Why Barclays PLC's (LON:BARC) High P/E Ratio Isn't Necessarily A Bad Thing
    Simply Wall St.

    Why Barclays PLC's (LON:BARC) High P/E Ratio Isn't Necessarily A Bad Thing

    Today, we'll introduce the concept of the P/E ratio for those who are learning about investing. We'll look at Barclays...

  • Barclays Faces SEC Probe Into Sales of Property-Backed Bonds

    Barclays Faces SEC Probe Into Sales of Property-Backed Bonds

    (Bloomberg) -- U.S. regulators are investigating whether Barclays Plc violated securities laws after a former trader at the firm raised concerns about its marketing practices for certain bonds, according to legal filings.From September 2018 until this June, Barclays provided documents to the Securities and Exchange Commission in response to the agency’s probe, according to legal paperwork seen by Bloomberg News. The examination is preliminary and may not lead to any allegations of wrongdoing, said a person with knowledge of the matter who asked not to be named because the SEC review isn’t public.A Barclays spokesman in New York and an SEC spokeswoman declined to comment.The bank has previously attracted scrutiny from U.S. authorities over the way it sold bonds. Its role in selling securities backed by residential mortgages in the run-up to the financial crisis led to a $2 billion settlement with the Justice Department last year.The latest probe, involving bonds backed by commercial property sold in 2018, started after a complaint from a Barclays trader who was later fired from the bank. In a lawsuit filed in U.S. federal court in April over his termination, Brian La Belle, the former head of commercial real estate trading and distribution, alleged that the lender aggressively marketed a deal for bonds backed by hotels in a way that “could amount to securities fraud.”‘Improperly Altered’At Barclays, La Belle “witnessed a culture in which basic risk management and risk controls were flagrantly disregarded” and “serious compliance issues were ignored,” according to the lawsuit.According to legal filings, La Belle’s colleagues ignored his misgivings and feedback from potential investors that the debt load for an unnamed client was too large. He raised concerns that an independent report on the cost of upgrading hotels tied to the loan in 2018 “may have been improperly altered” following pressure from the bank to make the financing deal appear less risky, according to the lawsuit.La Belle defied the wishes of Barclays bankers and shared his views with investors, one of whom said the deal was “complete garbage,” according to his submissions to the court. The bank ultimately went ahead with the transaction.After raising the issues with Barclays, La Belle made complaints to several authorities including the SEC, legal documents show. La Belle was fired in August 2018 and is seeking $10 million in lost pay, arguing that his termination was a result of his whistle-blowing.Barclays has expanded its asset-backed offering under Chief Executive Officer Jes Staley, who has led the firm since 2015. The bank has recently assembled a team of over 140 to sell more securitized products, according to reports.(Adds date of deal in 5th paragraph and background on Barclays strategy in final paragraph.)To contact the reporters on this story: Stefania Spezzati in London at sspezzati@bloomberg.net;Matt Robinson in New York at mrobinson55@bloomberg.netTo contact the editors responsible for this story: Ambereen Choudhury at achoudhury@bloomberg.net, Marion Dakers, Keith CampbellFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Alarms Still Blare on Triple-B Bonds, But No One Cares

    Alarms Still Blare on Triple-B Bonds, But No One Cares

    (Bloomberg Opinion) -- In the bond market, it can sometimes feel as if the more things change, the more they stay the same.Consider the following two articles about the massive amount of triple-B rated corporate debt:“A $1 Trillion Powder Keg Threatens the Corporate Bond Market” by Bloomberg News. The takeaway: “A lot of these companies might be rated junk already if not for leniency from credit raters. To avoid tipping over the edge now, they will have to deliver on lofty promises to cut costs and pay down borrowings quickly, before the easy money ends.”“Bond Ratings Firms Go Easy on Some Heavily Indebted Companies” by the Wall Street Journal. The takeaway: “Amid an epic corporate borrowing spree, ratings firms have given leeway to other big borrowers. … The buildup has fueled one of the most divisive debates on Wall Street: Will higher debt loads cause big losses when the economy turns?”The first one is from October 2018 and the second from a couple of weeks ago. That alone isn’t what’s most interesting — financial-market themes tend to repeat themselves, after all. Rather, it’s the fact that market appetite for those bonds on the brink of junk couldn’t be any more different between then and now, even though it’s clear that fears about ratings inflation and a huge wave of downgrades haven’t gone away.Around this time last year, Scott Minerd, global chief investment officer at Guggenheim Partners, made headlines by tweeting that “the slide and collapse in investment grade credit has begun,” starting with General Electric Co. No one seemed to want to own bonds rated just a step or two above junk — the Bloomberg Barclays triple-B corporate-bond index trailed the broad market in 2018 for just the second time since the financial crisis. I was willing to be contrarian after his comments, writing that investors shouldn’t fear a doomsday that everyone seems to think is coming.Still, the rapid change in sentiment through the first 10 months of 2019 has been nothing short of astounding. While there were signs of the tide starting to turn earlier this year, triple-B bonds have now returned 14.4% through Oct. 30, better than any other rating category. If the gains hold through the end of the year, it would be the triple-B market’s strongest performance since 2009, when it bounced back from its worst annual loss on record amid the financial crisis. Investors have either made peace with the risk of mass downgrades when the credit cycle turns, or they’ve just decided to ignore it and reach for yield when the Federal Reserve is cutting interest rates. Neither seems to be sustainable.It’s not as if the Wall Street Journal’s recent article is an outlier — CreditSights said in an Oct. 30 report that about $70 billion of triple-B corporate debt is at risk of falling to junk within the next 12 months, including household names like Kraft Heinz Co., Macy’s Inc. and Ford Motor Co. It’s not a question of whether so-called fallen angels become more prevalent, according to the analysts, it’s “when and how fast.”As for the “debt diet” that was supposed to happen this year, which would make triple-B companies less leveraged? In the aggregate, it’s been exactly the opposite. Fitch Ratings, in an Oct. 31 report, noted that triple-B corporate issuance is on pace to reach a record in 2019 after accounting for almost two-thirds of the $515 billion in bonds sold through the first nine months of the year. Triple-B securities make up half of the $5.8 trillion investment-grade corporate bond market, Bloomberg Barclays data show.But perhaps the most telltale sign of just how little investors seem to mind the “ratings cliff” between investment- and speculative-grade is how they’re gobbling up double-B bonds just as voraciously as triple-Bs. In fact, on Oct. 28, the spread between the two dropped to 43 basis points, a new low, according to Bloomberg Barclays data. At the start of 2019, it was as high as 172 basis points. Even though triple-B corporate bonds are having their best year in a decade, double-B debt isn’t far behind. This trend isn’t going to end overnight. Investors poured $2.3 billion into investment-grade bond funds in the week through Oct. 30, and an additional $940 million into high-yield funds, according to Lipper data. The sub-2% yield on 10-year Treasuries is probably still causing sticker shock to some investors, given that until a few months ago it hadn’t breached that level since President Donald Trump’s November 2016 election. For those in Japan and Europe, buying U.S. corporate bonds rather than Treasuries is sometimes the only way to avoid negative currency-hedged yields. Global and structural forces keep investors slamming the buy button in credit markets.Eventually, though, something has to give, as it always does. For now, corporate-debt buyers are content to just avoid triple-C rated securities. That includes Guggenheim investors led by Minerd, who said in a note this week that “now is not the right time” to add the riskiest junk debt, given the downside potential of more than 20%.The reasoning makes sense — triple-C rated companies are the most prone to default in an economic downturn. But in such a slump, triple-B companies would be vulnerable to downgrades. If investors were so sure last year that rating cuts would be too much for the high-yield market to bear, why wouldn’t they also stay away from triple-B bonds at this point?There’s no obvious answer. It’s just a reminder that total returns aren’t everything. Even though triple-B securities are the belle of the ball in credit markets this year, nothing much has truly changed.To contact the author of this story: Brian Chappatta at bchappatta1@bloomberg.netTo contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • EM Review: Fed’s Rate Cut, Trade Hopes Ignited Relief Rallies

    EM Review: Fed’s Rate Cut, Trade Hopes Ignited Relief Rallies

    (Bloomberg) -- Emerging-market stocks rose for a fourth straight week last week and posted the best monthly advance since June, as the Federal Reserve confirmed investors’ expectations of a third-straight interest rate cut. While the U.S. central bank signaled a pause in further easing, appetite for higher yielding assets remained in place as signs of progress in the U.S. and China trade talks left investors more comfortable with taking risk. Developing-nation currencies strengthened for a fifth straight week.The following is a roundup of emerging-markets news and highlights for the week ending Nov. 3.Read here our emerging-market weekly preview, and listen to our weekly podcast here.Highlights:Federal Reserve officials reduced interest rates by a quarter-percentage point for the third time this year and signaled a pause in further cuts unless the economic outlook changes materiallyU.S. consumer spending trailed forecasts in September while weekly applications for unemployment benefits rose more than projected, offering a note of caution on the economyMeanwhile, U.S. hiring was unexpectedly resilient in October and prior months saw sharp upward revisions, validating the Fed’s signal of a pause from interest-rate cutsChina and the U.S. had a constructive conversation and achieved “consensus in principle” in a phone call between Chinese Vice Premier Liu He and U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven MnuchinEarlier in the week, Chinese officials were casting doubts about reaching a comprehensive long-term trade deal with the U.S. even as the two sides get close to signing a “phase one” agreement, while President Donald Trump had said the U.S. was ahead of schedule to sign a very big portion of the China dealCommerce Secretary Wilbur Ross expressed optimism the U.S. would reach a “Phase One” trade deal with China this month and said licenses would be coming “very shortly” for American companies to sell components to Huawei Technologies Co. Trump on Sunday told reporters at the White House that a trade agreement, if one is completed, would be signed somewhere in the U.S.China secured the World Trade Organization’s go-ahead to impose $3.6 billion in sanctions against the U.S., in a case that predates the tariff war but may add a layer of tension to ongoing talksSenator Marco Rubio plans legislation to block U.S. government pensions from investing in Chinese stocks after the board overseeing the funds put off a decision that would add exposure to ChinaHouse Speaker Nancy Pelosi moved the Democrats’ impeachment inquiry of Trump into a new phase that signals the public soon will get a look at the witnesses and evidence being assembled to build a case against the presidentTrump’s presidency stands on its most treacherous ground after the House voted to approve and proceed with its impeachment inquirySouth Africa is heading for a debt trap as bailouts for the embattled state power utility drain the government’s coffers and anemic economic growth weighs on tax revenueFinance Minister Tito Mboweni presented a rapidly deteriorating outlook in his medium-term budget policy statement, with gross government debt seen surging to 80.9% of gross domestic product in the 2028 fiscal year unless urgent action is takenEskom Holdings SOC Ltd. will receive 138 billion rand ($9.2 billion) in bailouts through March 2022, or 10 billion rand more than previously allocatedSouth Africa dodged its third junk rating Friday -- something markets had been counting on for months -- as Moody’s Investors Service maintained the nation’s lowest investment grade score but revised its outlook to negative from stableFitch Ratings raised its outlook for Turkey’s sovereign assessment to stable from negative, citing an improving current account balance, continued economic growth and falling inflationLebanon’s Prime Minister Saad Hariri stepped down Tuesday after two weeks of anti-government protests descended into violenceCalls are mounting for Lebanon to impose formal restrictions on the movement of money to defend the country’s dollar peg and prevent a run on the banks when they open their doors after nationwide protestsThe yield on the nation’s dollar bond due 2021 climbed above 30%Asia:China’s ruling Communist Party warned that internal and external risks were increasing after wrapping up its most important meeting of the yearA gauge of the outlook for the country’s manufacturing sector dropped to the lowest level since February, underlining the weakness of an economy buffeted by weak domestic demand, shrinking profits, and the trade war with the U.S.South Korea’s semiconductor inventories fell the most in more than two years in September, signaling a potential end to a prolonged slump in tech demand that has weighed on global growthSamsung Electronics Co. reported earnings that beat estimatesFOMC rate cut will help maintain global growth trend and have positive impact on the South Korean economy, central bank Senior Deputy Governor Yoon Myun-shik saidExports plunged the most in almost four years while consumer prices failed to rise for a third straight month in October, highlighting continued pain in this Asian bellwether for global tradeThe U.S. won a case against India at the World Trade Organization alleging improper use of export subsidies valued at more than $7 billionIndia’s farmers’ organizations have planned a nationwide protest on Nov. 4 to demand that the government keep agriculture out of a 16-nation trade agreement currently being negotiated in ThailandFiscal deficit for April-September was 6.52 trillion rupees ($92 billion) versus 7 trillion rupees targeted in the budget for the financial year ending March 31India is committed to further improving its people-friendly tax regime, Prime Minister Narendra Modi said, as Asia’s third-largest economy seeks to attract more overseas investment to spur growthThe global slowdown and trade war have created an environment in which “low interest rates for longer” is the new normal, Bank Indonesia Governor Perry Warjiyo said. Separately, Warjiyo said the central bank’s monetary policy will continue to be data dependentIndonesia suspended exports of nickel ore with immediate effect after a planned ban on shipments from the beginning of next year led to a rush to beat the deadlineThe government warned it will revoke export licenses from mining companies that breach rules on shipping nickel ore as it steps up inspections ahead of an export banThe country’s state budget deficit is at 1.7%-1.8% as of September, while the government sees growth at between 5.08% and 5.1% this yearThailand will request a dialogue with the U.S. at the East Asia Summit due in November to regain scrapped trade benefits, Keerati Rushchano, the acting director general of the Department of Foreign Trade, saidPrime Minister Prayuth Chan-Ocha has asked the Foreign Ministry, Labor Ministry and Commerce Ministry to start talks with the U.S. to explain the country’s stance on labor issues as the nation to set up task force to restore trade preferencesThe value of foreign direct investment applications from China doubled during the first nine months of 2019 compared with a year earlierThe current-account balance narrowed in line with the trade surplus on falling gold exportsThe central bank said third-quarter economic growth may be lower than 2.9%Philippines plans to offer prize bonds in November as government seeks to tap liquidity in financial market after central bank’s reserve ratio cuts, Treasurer Rosalia de Leon saidThe Securities and Exchange Commission has asked Bangko Sentral ng Pilipinas to consider setting ceilings on the interest rates and other fees that lending and financing companies may imposeOctober inflation likely 0.5% to 1.3%, according to the central bankTaiwan’s economy in the third quarter grew at the fastest pace since the second quarter of last year as domestic investment and better-than-expected overseas demand helped avoid the worst of the U.S.-China trade warChina’s ban on individual travel to Taiwan could see visitors to the island fall for the first time since the devastating SARS outbreak of 2003. The number of mainlanders traveling to the island plunged 46% in September, according to data from Taiwan’s Tourism BureauThe Financial Supervisory Commission said it is raising the risk-capital charge for insurance firms buying exchange-traded funds that track foreign bonds but are denominated in local currencyThe U.S. Justice Department has struck a deal with fugitive financier Jho Low to recoup almost a billion dollars looted from Malaysian investment fund 1MDBMalaysia maintains claim of $7.5 billion from Goldman Sachs Group Inc. for the bank’s role in arranging bond sales for 1MDB, Finance Minister Lim Guan Eng saidThe country expects its credit rating to remain stable in the near future due to institutional reform, resilient economic growth as well as clear and consistent messaging to investment community, finance minister saidU.S. is unlikely to label the nation a currency manipulator, Finance Minister Lim saidVietnam slapped five-year tariffs on Chinese and South Korean color-coated steel products after domestic producers said unfair pricing from overseas competitors caused them to shut down production linesEMEA:South Africa’s government is talking with potential investors in the state-owned airline in an attempt to ease the continuing burden the company puts on the national budgetMozambique President Filipe Nyusi won a second term by a landslide in the natural-gas-rich nation’s Oct. 15 elections that the main opposition rejected as a “mega fraud”The Kenya National Assembly’s finance committee agreed to support President Uhuru Kenyatta’s decision to reject a bill that sought to retain caps on what banks can charge on loans, paving the way for the removal of a law that cut credit to businessesRussia’s biggest rate cut in two years was well flagged by Governor Elvira Nabiullina, but when it came, the move gave an extra boost to one of the strongest bond rallies in emerging markets this year, driving generic 10-year yields to their lowest since before the 2008 financial crisisFor all their talk about breaking Washington’s dominance, Russia and Turkey are still pretty hooked on the U.S. currency, according to data published by the Bank of RussiaTurkey’s central bank lowered its inflation estimate for the end of this year to 12% from 13.9%, citing a faster-than-expected slowdown in food prices and a stable liraTurkey offered to buy shares in Borsa Istanbul that the European Bank of Reconstruction and Development plans to sell following concerns over a convicted banker’s appointment to lead the benchmark stock exchangeBulgaria’s ruling party held on to the capital city in local elections, fighting off a challenge by the opposition-backed candidateShares in Saudi state oil giant Aramco will start trading on the Middle Eastern country’s stock exchange on Dec. 11, television news channel Al Arabiya reported, without identifying the source for the informationThe energy giant earned $68 billion in the first nine months of the year, cementing its position as the world’s most profitable company, according to people familiar with the figuresSaudi Arabia finally kicked off what could be the world’s biggest initial public offering, revealing potential tax cuts and dividends to lure investorsEgypt said it picked five banks, including JPMorgan Chase & Co. and Citigroup Inc., to manage a new dollar-denominated bond issuance in the 2019-20 fiscal yearA religious ruling in Kuwait against two initial public offerings launched in October is stirring fears that the Gulf state is clamming up at a time its bigger neighbor Saudi Arabia is doing just the opposite, courting investors in anticipation of Saudi Aramco’s IPOLatin America:Argentina’s President-elect Alberto Fernandez has six weeks to put the pieces of his cabinet puzzle together before starting a government that will have no shortage of economic problemsBonds slid after the vote and investors are now watching for the final composition of congress and how that may impact key legislation, including a debt restructuringAurelius Capital Management LP, one of the lead hedge funds that settled a massive litigation over defaulted bonds with Argentina in 2016, made a new claim in New York for $159 million it says the South American nation owes on securities tied to the performance of its economyArgentina lowered the floor on its key interest rate while defending its latest round of capital controls as a way to ease the transition period until Fernandez takes office Dec. 10Fernandez said he will put policies in place to boost manufacturing, including local textile and shoe producersBrazil’s central bank signaled it will stick with the current pace of monetary easing at its next meeting after lowering the key rate by a half point for the third straight time and forecasting inflation below target through 2021Industrial output rose less than expected in September as capital goods production dropped for the fourth straight month, signaling companies are still reluctant to investUnemployment rate unexpectedly held steady in the three months through September amid an increase in the number of people seeking workA Globo report on President Jair Bolsonaro being potentially linked to the murder of a lawmaker in Rio de Janeiro last year was quickly dismissed after prosecutors said that a key statement that supported the accusation was proved wrong during the investigationLower house Speaker Rodrigo Maia said the allegations do not “harm at all” the lower house agendaBolsonaro said he won’t attend the inauguration ceremony for his Argentine counterpart Fernandez in a fresh sign of souring ties between South America’s largest economiesMexico’s gross domestic product rose 0.1% in the third quarter from three months earlier, according to preliminary data -- that’s less than a 0.2% median analyst forecastU.S. companies and trade groups that want lawmakers to approve a new trade pact with Mexico and Canada are making the unusual bet that the impeachment drama in Washington could actually help get the deal through CongressHouse Speaker Nancy Pelosi said the new Nafta deal is the “easiest trade deal that we’ve ever done”Chile’s President Sebastian Pinera fired eight top officials, including the interior, finance and economy ministers, after 10 days of riots, protests and reprisalsMore violence erupted in Chile and dozens of citizens have been partially blinded by rubber projectiles and gas canisters that police and soldiers fired into crowds of protestersMany Chileans are clamoring for a solution that sends shivers down the spine of part of the country’s elite: a new ConstitutionColombia’s central bank defied the emerging market trend for interest rate cuts and left borrowing costs unchanged at its October meetingUruguay’s presidential candidate from the leftist coalition that’s governed the country for almost 15 years faces an uphill battle to win over at least part of the majority of voters who supported right-wing candidates in Sunday’s election before a November runoffTwo people died in clashes over the results of Bolivia’s Oct. 20 election in the latest episode of political violence that’s flared across South AmericaVenezuela gave El Salvadoran diplomats just 48 hours to leave the country after a similar move by El Salvador’s President Nayib Bukele\--With assistance from Selcuk Gokoluk and Carolina Wilson.To contact Bloomberg News staff for this story: Yumi Teso in Bangkok at yteso1@bloomberg.net;Netty Ismail in Dubai at nismail3@bloomberg.net;Aline Oyamada in Sao Paulo at aoyamada3@bloomberg.netTo contact the editors responsible for this story: Tomoko Yamazaki at tyamazaki@bloomberg.net, Cormac MullenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Reuters

    UK lawmakers want bank payments "speed bump" to stop scammers

    A mandatory 24-hour delay on all first-time payments from one bank account to another would cut mounting fraud in finance, UK lawmakers said in a report on Friday. Parliament's Treasury Select Committee said fraudsters stole over 600 million pounds ($777 million) from consumers in the first half of 2019 and regulators must crack down harder on scammers. With money transfers between accounts taking just seconds, customers or their bank have little time to be aware that a fraud has taken place, the report said.

  • Britain’s Billionaire Twins Shake Up an Opaque Empire

    Britain’s Billionaire Twins Shake Up an Opaque Empire

    (Bloomberg) -- After six decades spent buying up assets spanning retail, media and real estate, one of Britain’s most discreet billionaire clans is weighing a retreat.The investments by the families of David and Frederick Barclay have put them among the top ranks of the country’s rich and powerful. The twins have forged reputations as stealthy buyers who rarely turn to public markets or investment bankers to finance deals for their closely guarded business empire.In a surprise twist, the Barclays are now considering offloading some of their most prominent holdings. Those include the Telegraph newspaper titles and Mayfair’s five-star Ritz hotel, where guests dine below chandeliers and can see the sights of the English capital in a custom Rolls-Royce.The Barclays have hired lawyer Marco Compagnoni of Weil Gotshal & Manges, whom they’ve worked with before, to advise on the review, according to people with knowledge of the decision, who asked not to be identified because the matter is private. Compagnoni declined to comment, as did a representative for the Barclays.The Times of London was first to report the plans, which come as some of their holdings are under pressure.Over the past two years, the brothers have injected more than 300 million pounds ($386 million) into businesses such as online retailer Shop Direct and delivery service Yodel. Last week, Shop Direct said it was exploring financing options after disclosing it’s seeking 150 million pounds in extra funding to cover a spike in claims tied to Britain’s insurance mis-selling scandal. The shortfall creates a “material uncertainty,” the company’s auditor, Deloitte, said Monday.The Telegraph group could attract a number of bidders. Although no formal process has started, Daily Mail & General Trust Plc could be interested, according to a person familiar with its intentions, as declining newspapers merge to maximize their audience while minimizing operational costs. A representative for DMGT declined to comment.The Barclays may struggle to recoup the 665 million pounds they spent to buy the paper in 2004. Circulation and earnings have plummeted, there have been repeated rounds of job cuts and operating profit was just 700,000 pounds for the most recent financial year. Still, the paper remains influential in the U.K. It’s been a leading voice for Brexit and employed Boris Johnson as a columnist until he became Prime Minister in July.With Middle Eastern money backing most of London’s luxury hotels these days, the brothers may look farther afield to sell the Ritz. Four years ago, they sold their stake in three other London hotels -- Claridges, the Berkeley and the Connaught -- to Qatari investors.It’s already been a busy year for the Barclays, who turned 85 on Sunday. David lost a libel case he filed against a little-known French playwright who satirized the lives of him and his brother in July, and his lawyer said at the time that he would probably appeal. This month, it emerged that Frederick is embroiled in a divorce court row with his estranged wife. A judge who oversaw the preliminary hearing placed limits on what can be reported, but the case may eventually shed light on the Barclay family’s finances if it reaches a public decision.“For someone concerned about their privacy and public profile, that is a pretty horrible thing to contemplate,” said James Ferguson, a partner at London law firm Boodle Hatfield who specializes in family matters including divorces. “It’s going to incentivize him to want to settle the case.”David is the older sibling by 10 minutes. Born to Scottish parents, they spent their early days in a west London household so close to a railroad that trains rumbling by would rattle the windows. After leaving school at 16, David and Frederick started their careers in the accounts department of General Electric Co., according to “The Twin Enigma,” a 2010 book by Vivienne Lewin. They teamed up in the 1960s to turn old boarding houses into hotels and moved into breweries and casinos, marking the beginning of their business empire.When a Middle East oil embargo sparked a collapse in U.K. stocks and real estate during the 1970s, the twins defaulted on loans owed to a British government agency that had expanded into corporate lending. The brothers almost lost everything, but were spared from absorbing the full losses.The twins have since bought companies that others often reject or overlook, developing real estate and selling off pieces for quick profits. That strategy has allowed the Barclays to own more than 50 firms in the U.K., Japan and Sweden and gain stakes in at least a dozen more.These include Sears Plc, which once had businesses ranging from women’s wear to mail-order shopping. With financing from Bank of Scotland and Bank of Boston, the Barclays joined with fellow billionaire Philip Green two decades ago to buy the clothing retailer for 548 million pounds. Green and the Barclays recouped the purchase price within 12 months by selling some of Sears’s real estate and its three retailing units.The Barclays also paid 2.3 million pounds in 1993 for the English Channel island of Brecqhou off the U.K.’s southern coast for a family compound. They erected a mock-Gothic castle, complete with almost 100 rooms, gilded turrets and a helipad. A visitor from the neighboring island of Sark said framed pictures of the brothers with Nelson Mandela, Margaret Thatcher and Charles de Gaulle adorned a palatial living room. The twins would finish each other’s sentences, the visitor said.Even as their holdings grew, the business has remained a family affair, with David’s sons Aidan and Howard increasingly running matters.“Our business is large, but is a family business,” Frederick Barclay said in a 2012 witness statement as part of a U.K. court case about their attempts to buy a number of luxury hotels in London. “My brother and I retain a strong interest in the affairs of the business and regularly discuss matters with Aidan and Howard and other advisers.”But even as the family’s holdings evolve and the younger generation exerts more sway, one tenet remains constant: Discretion is paramount.(Updates with Deloitte comment in sixth paragraph.)\--With assistance from Tom Metcalf and Jack Sidders.To contact the reporters on this story: Ben Stupples in London at bstupples@bloomberg.net;David Hellier in London at dhellier@bloomberg.net;Thomas Seal in London at tseal@bloomberg.netTo contact the editors responsible for this story: Pierre Paulden at ppaulden@bloomberg.net, Steven Crabill, Rebecca PentyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • StockBeat: Beyond Meat Hit Hard as IPO Lockup Period Ends

    StockBeat: Beyond Meat Hit Hard as IPO Lockup Period Ends

    Investing.com – Beyond Meat (NASDAQ:BYND) fell sharply as restrictions preventing investors from selling shares in the plant-based meat maker expired Tuesday.

  • At This Price, The U.K.'s Telegraph Is More Than a Vanity Play

    At This Price, The U.K.'s Telegraph Is More Than a Vanity Play

    (Bloomberg Opinion) -- If the owners of Britain’s Daily Telegraph are serious about wanting to sell the publication for a price similar to what they paid for it 15 years ago then they’ll need to make a very convincing argument that it’s a perfect megaphone to influence British politics, especially at this crucial time in the country’s history. No serious media investor is going to front that sort of cash.Gambling that a deep-pocketed billionaire somewhere wants to exert outsized influence on the negotiations to exit the European Union looks like the best hope for the Barclay brothers to recoup the purchase price of 665 million pounds ($854 million), as the Financial Times has reported is their goal.The Barclays bought the newspaper when the market was in much better shape. In the middle of the last decade, Britain's 10 daily national newspapers sold a cumulative 11.2 million copies and attracted about a quarter of advertising spending, according to Department for Media, Culture and Sport figures from 2007. By 2017, circulation had fallen to 6.1 million copies, and just 6% of advertising went to the print editions of newspapers, as Google and Facebook Inc. gobbled up ad dollars and readership shifted online.It’s hard to see how a strategic buyer such as Daily Mail and General Trust Plc, which has said it’s on the prowl, could justify paying such an exorbitant fee for a business in structural decline. There are good reasons why bringing the Daily Mail and Telegraph under one roof might make sense – both are right-of-center and some operational costs could be shared. But Paul Zwillenberg, the chief executive officer of the Daily Mail and General Trust,  has been adamant that he won’t overpay for media assets.Even with adjustments for one-time items, operating profit at the Telegraph Media Group Ltd., parent of both the daily newspaper and its Sunday stablemate, fell to 7.8 million pounds last year. Back in 2004, the year in which David and Frederick Barclay bought it, the company enjoyed 32 million pounds of operating profit.Daily Mail and General Trust commands an enterprise value that's just over 12 times last year's operating profit. Taking that as the yardstick, the Telegraph would be valued at less than 100 million pounds based on last year's performance. That rather generously ignores the fact that DMGT these days generates less than half of profit from its media business.How might the Telegraph be worth the reported 665 million pounds sought? That would need high confidence that its turnaround, initiated by CEO Nick Hugh, is set to accelerate rapidly — that the low numbers of 2018 reflect increased spending that will boost growth. Or a buyer might eye the scope to cut a lot of duplicate costs. If the Daily Mail and the Telegraph were to join forces, the cost base from their combined media operations would be some 850 million pounds.Cutting that outlay by 7% would add 60 million pounds to operating profit and more easily justify the Barclays' target price, but doing so could prove challenging given the extent to which costs have already been pared at both companies. More realistically, were the Telegraph's profit to return to 2017 levels, a valuation nearing 200 million pounds would seem more appropriate.So the only way for the owners to achieve their asking price would likely be to find a billionaire who’s looking for much more than the typical vanity purchase, and is truly keen to sway how discussions to leave the EU evolve. Even if Britain’s initial deal to leave the trading bloc passes parliament by the end of January, there could be a transition period of negotiations stretching to the end of 2022.Despite their declining readership, the Daily Telegraph and Sunday Telegraph remain hugely influential on the right of British politics. Before becoming prime minister, Boris Johnson himself was a weekly columnist for the daily newspaper.In the U.S., a handful of storied publications have been snapped up by billionaire benefactors: Salesforce.com Inc. founder Marc Benioff and his wife Lynne bought Time magazine for $190 million last year; Amazon.com Inc. billionaire Jeff Bezos snapped up The Washington Post for $250 million in 2013; and Laurene Powell Jobs, the widow of Apple Inc. co-founder Steve, secured control of the Atlantic magazine last year. In each case, however, the valuation was far more realistic given the evolution of the news industry.At any rate, there are probably cheaper ways to influence the debate in the U.K. And it’s hard to see how a buyer pursuing a single-issue agenda would be good for quality journalism.If the Barclay brothers do indeed need to sell the newspaper to fund other businesses, as the Financial Times’s report on Sunday suggested, then they will need to be realistic about the asking price.To contact the author of this story: Alex Webb at awebb25@bloomberg.netTo contact the editor responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Alex Webb is a Bloomberg Opinion columnist covering Europe's technology, media and communications industries. He previously covered Apple and other technology companies for Bloomberg News in San Francisco.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • The Explosion in Green Bonds Comes Without a Premium

    The Explosion in Green Bonds Comes Without a Premium

    (Bloomberg Opinion) -- Given the undoubted and seemingly unbridled enthusiasm for green bonds, why don’t they trade at a premium to their less environmentally friendly counterparts in the debt markets? After a reader posed that question to me a few weeks ago, I’ve struggled to come up with a coherent answer.The market for green bonds has exploded, with global sales increasing by more than 300% in the past five years to reach $162 billion this year.  It seems logical that bonds sold specifically to finance projects deemed beneficial to the environment should trade at higher prices and lower yields than vanilla debt. At the margin, funds dedicated to following environmental, social and governance principles can buy the former but not the latter; so the universe of potential buyers for green debt is just that bit bigger. Moreover, investors in theory would be willing to sacrifice some yield in exchange for the knowledge that their money is benefiting the planet. And yet any meaningful premium seems absent.At first glance, the returns available from green bonds in the past half-decade have outpaced the broader market by a narrow margin. The Bloomberg Barclays Euro Green Bond Index shows a total return of 18% since 2014, not much different from the 16% gain in the broader investment grade index but beating the 13.5% that investors have made in euro corporate debt.And while the green returns seem to accelerate in recent months, the data show that those bonds have added a bit more than 9% in the past year, almost identical with the gain in investment grade debt. There’s an issue with that comparison, though. The euro corporate index contains more than 2,800 bonds worth 2.3 trillion euros, versus just 200 issues with a value of 207 billion euros in the green bond index. The European investment grade index dwarfs both, with almost 7,300 bonds worth 15.3 trillion euros.Moreover, a single bond issued by the French government with a total size of 21 billion euros dominates the green index, with a weighting of almost 13%. The index is also stuffed with bonds sold by the AAA rated European Investment Bank, and the German state development bank KfW, which also has the highest credit rating. So its usefulness for measuring returns is limited.What do individual bonds from a single issuer tell us? That French bond is the big beast in the green market after several increases since its initial sale in January 2017. At launch, it was priced to yield 13 basis points more than a non-green counterpart. Since then, it has traded in lockstep with other French government debt of similar maturity.There’s a similar trend in the Dutch government bond market, where a green bond sold in May  — the first from a AAA rated government  — has maintained its yield relationship with non-green debt with similar maturities.And in the U.S., a study of municipal bonds published earlier this month by David Larcker and Edward Watts of Stanford University showed that 640 matched pairs of bonds issued on the same day by the same municipalities with identical maturities displayed an “economically trivial difference in yield.” For 85% of the securities, yields were identical. “Investors appear entirely unwilling to forgo wealth to invest in environmentally sustainable projects,” the authors conclude.The climate crisis has put the spotlight on the financial community as the provider of capital that can make or break the planet. Green bonds are a useful part of the armory, provided the proceeds really are used for the benefit of the environment and not just greenwashing. As more money flows into ESG-friendly securities, it seems likely that they will eventually trade at a premium to the rest of the debt market — at which point the early adopters will reap the rewards for getting in ahead of the pack.To contact the author of this story: Mark Gilbert at magilbert@bloomberg.netTo contact the editor responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of "Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable."For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Bloomberg

    EM Review: Wave of Rate Cuts, Trade-Deal Optimism Spurred Rally

    (Bloomberg) -- Emerging-market currencies and stocks advanced last week as expectations the U.S. and China can sign a trade agreement as soon as November boosted appetite for riskier assets. A wave of rate cuts also helped lift growth-led assets, with Russia speeding up the pace of easing and Chile lowering borrowing costs as the worst civil unrest in three decades dimmed the outlook for the economy.The following is a roundup of emerging-market news and highlights for the week ending Oct. 27.Read here our emerging-market weekly preview, and listen to our weekly podcast here.Highlights:President Donald Trump said China has indicated that negotiations over an initial trade deal are advancing, raising expectations the nations’ leaders could sign an agreement at a meeting next month in ChileChina said parts of the text for the first phase of a trade deal with the U.S. are “basically completed” as the two sides reached a consensus in areas including standards used by agricultural regulatorsChinese and U.S. officials will discuss plans for China to buy more American farm products in exchange for the removal of some planned and existing U.S. tariffs in talks on Friday, Reuters reported, citing unidentified people briefed on the talksThe U.S. and China are close to finalizing sections of the first phase of a trade deal that President Donald Trump and China’s Xi Jinping hope to sign at a summit in Chile next month, the Office of the U.S. Trade Representative saidChina aims to buy at least $20 billion of agricultural products in a year if it signs a partial trade deal with the U.S., people familiar with the matter saidU.S. Vice President Mike Pence criticized China’s actions against protesters in Hong Kong while calling for greater engagement between the world’s two biggest economies, delivering a long-anticipated critique of Beijing’s human rights record as the two nations try to resolve their trade warPeople’s Bank of China Governor Yi Gang said the yuan is at an “appropriate level” and cross-border capital flows have stayed balanced since the currency weakened past 7 per dollar in early AugustOpposition candidate Alberto Fernandez swept Argentina’s presidential election on Sunday, ousting pro-market incumbent Mauricio Macri and tilting the nation back toward left-wing populism at a time of economic crisisThe central bank tightened limits on the amount of dollars savers can purchase after Fernandez won the presidencyREAD: Argentina Investors Look Ahead After Fernandez Pulls Out WinBrazil’s Senate took the final step in the approval of a long-awaited pension reform that’s the centerpiece of President Jair Bolsonaro’s plans to cut government debtLawmakers on Wednesday gave the final go-ahead to legislation that will save public accounts approximately 800 billion reais ($198 billion) in a decadeThe largest ETF tracking Brazilian stocks had its biggest daily inflow in eight monthsBolsonaro landed in China on a mission to strengthen relations with Beijing amid the looming question of whether the Latin American giant should allow Huawei Technologies Co. to build its 5G networkChilean markets were shaken by the worst civil unrest in 29 years as a wave of riots and demonstrations that brought Santiago to near a standstill left more than fifteen people dead and thousands arrestedWhat began as a protest against a 4-cent subway-fare hike quickly turned into an outpouring of broad discontent over economic inequality, pensions, health and educationPresident Sebastian Pinera has signed necessary decree to lift Chile’s state of emergency, presidency announced on TwitterIndonesia’s central bank cut its key interest rate for a fourth straight month to spur the economy amid a deteriorating outlook for global growth. Bank Indonesia lowered the seven-day reverse repurchase rate by 25 basis points to 5%The Philippine central bank will reduce the amount of fund lenders must hold in reserve by 1 percentage point to 14% in early December, Governor Benjamin Diokno saidTurkey’s central bank delivered another interest-rate cut that exceeded forecasts after President Recep Tayyip Erdogan’s deal to secure a buffer zone in northern Syria eased concern over the fallout of his cross-border offensiveTrump said he is lifting recently imposed sanctions against Turkey after the country complied with a cease-fire agreement with Kurdish forces in SyriaChile’s central bank cut its benchmark interest rate for the third time in five months and said additional easing may be needed as the worst civil unrest in decades threatens to slow economic growthLebanon’s central bank and commercial lenders will be the biggest contributors to the government’s plan to nearly wipe out its budget deficit next year -- providing an estimated $3.3 billion in savings in the battle to avert financial meltdownThe U.K. Parliament blocked Prime Minister Boris Johnson’s plan to rush his Brexit deal into law, leaving proceedings in limboAsia:China’s base rate for new corporate loans stayed unchanged in October, defying expectations of a reduction as the economy grows at the slowest pace since the early 1990sThe nation’s central bank added 250 billion yuan ($35 billion) into the banking system, the largest amount in a daily open market operation since MayChinese companies have borrowed a record $61 billion through syndicated loans in the offshore market in the first three quarters of the year, with private firms accounting for 60%, according to data compiled by Bloomberg. That’s up from 54% a year earlierOf about 3,200 commercial bankers surveyed by the People’s Bank of China, 4.1% consider monetary policy “tight”The Chinese government is considering a plan to replace Hong Kong’s Carrie Lam as chief executive, pro-establishment lawmaker Michael Tien said, in a potential strategy shift by Beijing as pro-democracy demonstrations continue to rock the Asian financial centerSouth Korea is abandoning its developing-nation privileges at the World Trade Organization following allegations by the Trump administration that some countries were taking advantage of the statusThe country’s export-dependent economy is facing a “grave situation” as the U.S.-China trade war and the spread of trade protectionism heap pressure on the global economy, President Moon Jae-in saidThe economy grew at a slower pace in the third quarter. Gross domestic product increased 0.4% from the previous quarterExports during the first 20 days of October fell 20% from a year earlier, data from the Korea Customs Service showedJapanese Prime Minister Shinzo Abe and South Korean premier Lee Nak-yon agreed they must work to ease the feud between the two neighbors that has spilled over into trade and security after their highest-level meeting in more than a yearIndia is considering placing curbs on some imports from Turkey and Malaysia, in response to their leaders’ comments on the autonomy of Kashmir, people familiar with the matter saidThe country will spend about 410 billion rupees ($5.8 billion) on two unprofitable state-run telecommunication companies in a bid to help the firms take on competitionThe nation’s top court ordered eight telecom carriers, including Bharti Airtel Ltd. and Vodafone Idea Ltd., to pay the government as much as 920 billion rupees ($13 billion) in past duesIndia’s central bank hasn’t sold any gold recently nor is trading in the metal, the monetary authority said in a tweet on SundayIndonesian President Joko Widodo’s new cabinet is taking shape with some well-known business figures set to join his team as he pledges to put the world’s fourth most-populous country on path to become a $7 trillion economy by 2045Widodo reappointed Sri Mulyani Indrawati as finance minister in a new cabinet. He asked the nation’s opposition leader and the founder of its biggest startup to join a revamped cabinetWidodo ordered his ministers to identify a list of rules and regulations at regional and national levels hampering investment and public serviceThe country may widen its budget deficit to 2%-2.2% of gross domestic product this year as the government tries to counter a global slowdown, a Finance Ministry official saidIndonesia ruled out canceling planned auction of sovereign rupiah bond during the remainder of the year even after raising $2.1 billion from a global dollar and euro bond saleThe central bank will allow rupiah to strengthen in line with market mechanisms, according to Nanang Hendarsah, executive director for monetary managementThailand’s exports unexpectedly fell for a second month in September. Trade surplus was $1.28 billion, less than the projected $2.21 billion excessThe cabinet approves stimulus steps to boost the economy, Finance Minister Uttama Savanayana saidEmerging markets may need to follow moves by advanced economies “to avoid appreciation of their currencies,” Bank of Thailand Governor Veerathai Santiprabhob saidA further reduction in Thailand’s benchmark interest rate won’t help much in efforts to restrain the baht, a member of the nation’s monetary policy committee saidTrump is suspending some trade preferences for Thailand over concerns about worker rightsMalaysia may become a target of sanctions as the export-reliant economy is caught in the crossfire of the U.S.-China trade war, according to Prime Minister Mahathir MohamadRepresentatives for Malaysia have discussed a penalty of around $2 billion-$3 billion in talks with Goldman Sachs Group Inc. for its role in the 1MDB scandal, according to people with knowledge of the matterConsumer prices rose 1.1% in September from a year earlier, less than median estimate 1.3% gain and 1.5% increase in AugustThe Philippine central bank doesn’t need to intervene in the currency market even after the peso climbed to a three-month high, said Felipe Medalla, a member of the policy-making Monetary BoardPresident Rodrigo Duterte will unveil a revised list of about 100 big infrastructure projects to be launched before his term ends in 2022, after some earlier projects were found to be unfeasible, an adviser saidThe nation plans to raise $3.5 billion from overseas bond sales in 2020, including debt denominated in the dollar, yen, euro and yuan, Treasurer Rosalia de Leon saidGovernment spending rose in September at the fastest pace in more than a year, which economists say could spark a rebound in growth in the second half of 2019GDP growth likely to accelerate to about 6.5% in 4Q on government spending, Christmas spending and benign inflation, Philippine central bank deputy governor Francis Dakila says in Manila briefingTaiwan’s export orders fell 4.9% on year in September, compared with 8.3% decline in AugustEMEA:Russia and Turkey agreed to work together to take back large chunks of Syrian territory controlled by Kurdish forces once allied with the U.S., giving each country a bigger say in how postwar Syria will lookThe Bank of Russia sped up the pace of monetary easing with a rare 50 basis-point cut to the interest rate and said it is considering more reductions after inflation showed signs of dropping well below a 4% targetPoland’s nationalist ruling party asked the Supreme Court for a partial recount in this month’s elections after it lost its majority in the SenateThe nation’s plan for its first post-communist balanced budget came under threat after factions of the ruling party quarreled over their intentions to juice the economy with post-election stimulusOne of two central bankers who voted to raise interest rates in the Czech Republic just last month signaled he may be ready to change his mind. The koruna weakened against the euroLebanon’s emergency proposals in response to mass protests risk undermining the nation’s currency peg and confidence in the ability to repay debts, Moody’s Investors Service saidFollowers of Lebanon’s Iranian-backed Hezbollah took to the streets Friday, waving the armed movement’s yellow flags and defending its leader against criticism after nine days of nationwide protests demanding the ouster of the political eliteThe nation’s Eurobond yield curve was increasingly inverted as the government struggled to quell nationwide protests against worsening economic conditions and the perceived corruption of the ruling classA state prosecutor accused former prime minister Najib Mikati -- Lebanon’s richest man -- and the country’s biggest bank of making illicit gains from a subsidized housing program, in the first corruption case filed since anti-government protesters took to the streets a week agoSaudi Arabia raised $2.5 billion of Islamic bonds in its first international debt sale since a missile and drone attack on its oil industrySaudi Aramco is pushing to complete its initial public offering this year by relying more on local investors, after international money managers’ skepticism triggered a delay, people with knowledge of the matter saidSouth Africa’s core inflation rate fell to the lowest in almost eight years in September, leading to a decline in the annual headline reading, which could raise pressure on the central bank to cut its benchmark rateTuesday’s Treasury auction was the strongest in eight weeksSouth Africa’s opposition Democratic Alliance is imploding, leaving the ruling African National Congress secure in power even as the economy stagnatesAngola’s central bank kept its benchmark interest rate unchanged and announced that it will let the currency float freelyNamibia’s central bank held its benchmark interest rate to maintain the currency’s peg to South Africa’s rand despite forecasts that the economy is set to shrink for a third straight yearLatin America:Copper mining operations in Chile were disrupted and most ports were halted as workers joined anti-government protestsBrazil’s annual inflation rate fell below the floor of the central bank’s target range in mid-October, giving policy makers more leeway to press ahead with borrowing cost cutsEconomists lowered their inflation forecasts for both this year and next for the fourth straight week while also cutting estimates for the key rate in December as the central bank signals further easing aheadThe government is expected to announce measures to boost the labor market in the first week of NovemberBolsonaro appointed an experienced career diplomat as Brazil’s ambassador to the U.S., ending months of fruitless efforts to give the job to his own sonSupreme Court suspended session that could potentially result in former President Luiz Inacio Lula da Silva leaving prisonMexico’s inflation rate is poised for a second straight month at the target while a key gauge of economic activity unexpectedly fell, according to data released on Thursday that bolsters forecasts for steep interest rate cutsU.S. House Ways and Means Chairman Richard Neal said progress was made in USMCA talksMexico Undersecretary of Foreign Relations Jesus Seade said USMCA deal could be approved in a matter of monthsPemex imported less gasoline and diesel in the second quarter as its refineries produced more fuel and the government cracked down on fuel theftRetail sales rose 2.6% in August, exceeding forecastFernandez committed on Wednesday to protecting citizens’ savingsThe unofficial peso exchange rate fell to its weakest in seven years of record-keeping as investors count down the days until the the nation’s presidential electionArgentina’s central bank is studying alternatives to minimize FX volatility and the loss of reserves due to the uncertainty caused by the elections, according to a person with direct knowledge of the matterThe final tally in Bolivia’s election shows that Evo Morales got enough votes to win a fourth term as president, but opponents are disputing the result while the European Union and the Organization of American States called for a second roundCosta Rica Finance Minister Rocio Aguilar resigned on Wednesday after the Comptroller General recommended her suspension, casting doubt on the future of a reforms that helped restore investor confidence in the country\--With assistance from Selcuk Gokoluk, Alec D.B. McCabe, Andres Guerra Luz and Carolina Wilson.To contact Bloomberg News staff for this story: Yumi Teso in Bangkok at yteso1@bloomberg.net;Netty Ismail in Dubai at nismail3@bloomberg.net;Aline Oyamada in Sao Paulo at aoyamada3@bloomberg.netTo contact the editors responsible for this story: Tomoko Yamazaki at tyamazaki@bloomberg.net, Alex NicholsonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.