479.98 +4.84 (1.02%)
After hours: 6:04PM EDT
|Bid||477.00 x 1300|
|Ask||473.35 x 900|
|Day's Range||470.01 - 475.19|
|52 Week Range||360.79 - 513.00|
|Beta (3Y Monthly)||1.42|
|PE Ratio (TTM)||17.92|
|Earnings Date||Jul 19, 2019|
|Forward Dividend & Yield||13.20 (2.80%)|
|1y Target Est||524.38|
(Bloomberg) -- General Electric Co. agreed to sell a majority stake in a solar-energy business to BlackRock Inc., giving the investment giant footing in a growing market as the ailing manufacturer shifts its focus elsewhere.A fund managed by BlackRock’s Real Assets unit will own 80% of Distributed Solar Development, a new company created from GE Solar, the companies said Wednesday in a statement. Financial terms weren’t disclosed.The deal furthers GE’s streamlining as Chief Executive Officer Larry Culp seeks to rescue the conglomerate by narrowing focus around aviation, gas power and wind energy. The Boston-based company is using mergers to exit the oil and locomotive markets, and GE has said it is “evaluating strategic options” for its venture-capital operations.GE Solar, a consulting business with about 60 employees, has been incubated within GE since 2012. The unit, which doesn’t make solar panels, focuses on “solar and storage solutions for the commercial industrial and public sectors.” GE had explored solar-panel manufacturing but sold its technology to First Solar Inc. in 2013.GE fell 1.5% to $10.23 at 10:42 a.m. in New York, while BlackRock slid 1.5% to $470.13.Once RiskyBlackRock’s Real Assets unit, which has more than $50 billion in client commitments, started its renewable-power platform in 2012. The GE deal comes as investors begin prioritizing a solar segment that was once viewed as riskier than developments for utilities or homeowners: projects for commercial and industrial customers.Part of the impetus is money, as smaller solar farms offer returns that can be more than 2% higher than big projects.It’s also a matter of availability and supply. Large institutional investors have dominated recent auctions for utility-scale developments, crowding out other would-be buyers. And states including California have committed to rid their grids of emissions, encouraging more renewables developments.To contact the reporters on this story: Richard Clough in New York at email@example.com;Brian Eckhouse in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Brendan Case at email@example.com, Tony RobinsonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
BlackRock, Inc. today announced that its Board of Directors has declared a quarterly cash dividend of $3.30 per share of common stock, payable September 24, 2019 to shareholders of record at the close of business on September 5, 2019.
While steady iShares inflows are expected to boost BlackRock's (BLK) assets under management in the second quarter of 2019, higher costs might hurt results to some extent.
Moody's Investors Service, ("Moody's") has affirmed the Aaa-mf rating of the BlackRock ICS Euro Liquid Assets Fund to be changed to BlackRock ICS Euro Liquid Environmentally Aware Fund today. The money market fund seeks to provide a return in line with money market rates consistent with preservation of principal and liquidity. At least 80% of the fund's net assets will be invested in securities that meet the fund's environmental criteria as well as other characteristics, including social and governance factors.
A handful of mega-rounds by fintech companies dominated fundraising in the second quarter of this year, highlighting how venture capital firms with significant amounts to spend and the Japanese investment goliath SoftBank continue to feed private companies and delay their arrival on public markets. The number of funding rounds totalling $100m or more hit a record last quarter, according to a report from CB Insights and PwC. Some 64 US companies ranging from the online lender SoFi to the food delivery company DoorDash completed these so-called mega-rounds, contributing to a 10 per cent increase in funding from the first three months of this year.
The Global CIO of fixed income at BlackRock said the Federal Reserve should aggressively cut interest rates.
Abu Dhabi National Oil Company (ADNOC) has hired Bank of America Merrill Lynch and Mizuho to arrange the lease of its natural gas pipeline assets, sources familiar with the matter said, as the oil giant establishes new partnerships in an era of lower oil prices. ADNOC, which manages almost all of the proven oil reserves in the United Arab Emirates, has embarked on a major shake-up over the past two years to cut costs, boost efficiency and monetise its assets. The company is now looking to raise funds by leveraging its natural gas pipelines in a similar deal and has mandated Bank of America Merrill Lynch and Mizuho as transaction advisers, two sources familiar with the matter said.
Why keep research—historically given to clients who paid hefty commissions to trade stocks via the bank—and eliminate the brokerage business that had been a fountain of cash for decades? It is all part of a shift toward greater transparency in European financial markets, and declining costs for brokerage services in the face of technological change and regulatory pressure. The regulations, known as Mifid II—a revamped version of the Markets in Financial Instruments Directive—require fund managers to pay for stock research separately from trading commissions.
Money market funds that incorporate environmental, social and governance metrics are growing rapidly, with a spurt of activity by big asset managers such as State Street Global Advisors, BlackRock and DWS. Assets in the sector rose 15 per cent to $52bn during the first half of 2019, after growing 1 per cent through all of 2018, according to research from Fitch Ratings. This pool of assets is still very small compared with the total $6tn money market sector.
(Bloomberg) -- The fund industry is getting more relaxed about marijuana investment.BlackRock Inc., the world’s largest asset manager, is “likely” to start a cannabis-focused exchange-traded fund, as concern about the legality of such strategies starts to fade, according to Bloomberg Intelligence. Other large issuers could follow, boosting assets in pot ETFs to $5 billion over the next few years, analysts led by Eric Balchunas wrote in a report on Friday.“Like a big movie studio, BlackRock is apt to copy others’ successful theme ETFs,” wrote Balchunas. “BlackRock coming in would add some legitimacy along with some fee pressure.”A spokesman for the money manager said the firm has no plans to offer a marijuana ETF.It all sounds a bit pie in the sky, but BlackRock is investing in thematic strategies. These types of funds have quickly become big business, attracting more than $49 billion in the U.S. Last month, the money manager said that it plans to create and market ETFs based on five “megatrends,” which go beyond traditional sectors and geographic focuses, although none of these explicitly dovetails with cannabis stocks. Read more: The Pot ETF Race Is OnMeanwhile, the legal environment for pot funds is looking much more friendly. Conflicting U.S. laws around weed had encouraged big banks to shy away from providing custody services to would-be issuers of marijuana ETFs. But now the U.S. regulator is asking pot ETFs to produce third-party legal opinions verifying that they don’t violate state or federal laws, offering welcome cover for anyone thinking about dipping a toe into the booming industry.The world’s largest weed ETF, the $1.1 billion ETFMG Alternative Harvest ETF, submitted legal documents in May stating that the ETF and its investments did not run afoul of any laws. The cannabis companies it invests in all have necessary permits and licenses to operate, according to the filing. The $59 million AdvisorShares Pure Cannabis ETF -- which trades under the ticker YOLO -- submitted a similar letter in April.“The outside legal opinions can provide cover,” said Todd Rosenbluth, director of ETF research at CFRA Research. “Consistent with what we’ve seen with other thematic ETFs, the smaller, more narrowly focused ETF providers will spot a theme and then launch products, and at some point it will hit the radar for the big boys.”So far, smaller issuers have dominated issuance. A new fund from OBP Capital, a unit of the Nottingham Co., started trading this week, and Global X Management Co. also wants to bring a cannabis-themed ETF to market, regulatory filings show.Any entry by BlackRock would shake up the nascent category, and only about two or three products will win out, Balchunas wrote. Investor interest could begin to fade within the next couple of years, spurring a “day of reckoning” for pot ETFs, according to Daniel Straus, vice president of ETFs and financial products research at National Bank of Canada.(Adds challenges for newer issuers in 10th paragraph.)To contact the reporter on this story: Annie Massa in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Alan Mirabella at email@example.com, ;Jeremy Herron at firstname.lastname@example.org, Rachel Evans, Rita NazarethFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- A couple of prominent investment funds are currently living through a portfolio manager’s worst nightmare: So many customers are demanding their money back that withdrawals need to be frozen.Amit Deshpande, a former longtime risk manager, sees it as a wake-up call. In particular, he’s watching the growing ranks of asset managers who rely on ETFs to act as cash equivalents. He wonders whether the funds can be sold off to pay fleeing clients in times of stress as seamlessly as the stewards of the $4 trillion market would like.In other words, are exchange-traded funds the ATMs many managers believe them to be? Or will they fail to sell quickly enough and at sufficient prices during a crunch to fulfill customer demands?“We’ve taken a bunch of semi-liquid securities, put that into an equity wrapper, said now you’re an equity and now you’re liquid,’’ said Deshpande, currently head of fixed income quantitative investments and research at T. Rowe Price Group Inc. “It doesn’t always work that way.’’Client WithdrawalsSkeptics have long questioned how easily ETFs can be turned into cash during a sell-off. But most of the focus has been on the funds facing their own client withdrawals, not money managers holding ETFs to pay off investors in other kinds of funds.The growing concern comes as active managers such as U.K. stock picker Neil Woodford, Switzerland’s GAM Holding AG and London-based H20 Asset Management grapple with redemptions. Bond ETFs in particular are eliciting alarms. They account for less than 1% of the fixed-income market, but assets have grown quickly to $1 trillion and they’re increasingly popular as cash substitutes.About half the institutions that own bond ETFs are using them for cash management, according to a survey by Greenwich Associates. Eaton Vance Corp. uses a loan ETF to avoid cash drag in its short-duration strategic income fund, for example.Fund LiquidityMuch depends on the mismatch between the liquidity of the funds, which trade every second, and that of the securities they own. Proponents argue that this means ETFs better reflect the value of their holdings than slower-to-react mutual funds. But concerns linger that any breakdown in the relationship between the prices of the funds and their securities, particularly in fixed income, could imperil owners.The European Systemic Risk Board recently warned that price decoupling could raise systemic risk by destabilizing institutions that rely on ETFs for quick cash. The U.S. Securities and Exchange Commission didn’t respond to requests for comment.Boosters say that ETFs are ideal cash replacements thanks to a unique structure that makes them more liquid than other types of funds. While ETFs expand and contract as money flows in and out, they also trade on exchanges like stocks.Secondary TradesSecondary trading means there always should be a market. When an ETF’s price falls below the value of its holdings, sophisticated traders step in to buy the discounted ETF shares and swap them for the underlying securities. The traders can then sell those securities at the higher price, earning an arbitrage and bringing the price of the ETF back in line with its value.The world’s largest junk-bond ETF, the iShares iBoxx High Yield Corporate Bond ETF, sees about six shares trade in the secondary market for every share that’s created or redeemed on an average day, according to Bloomberg Intelligence. In times of market stress, that ratio can spike as high as 20 to 1.ETFs “absorb market activity as underlying bond trading recedes,” BlackRock Inc., the world’s largest issuer of ETFs, said in a paper last month.Flash CrashNot all U.S. bond ETFs are created equal, however. Though three of them trade more than $1 billion shares a day, half see turnover of less than $1 million. While ETFs are designed to meet redemptions with securities, funds that own leveraged loans or overseas debt usually hand out cash, tempering the arbitrage opportunities that keep fund values in line with their holdings.“When someone wants to look at an ETF very specifically for liquidity-management purposes, of course they should look at how actively traded that particular ETF is within that sector,” said Stephen Laipply, head of fixed-income strategy for BlackRock’s U.S. ETF business.Even the structure itself isn’t bulletproof. During the flash crash of Aug. 24, 2015, market makers on the exchanges found themselves unable to price ETFs as futures contracts went dark, and hundreds of ETFs temporarily stopped trading after the resulting volatility triggered exchange limits. In June 2013, Citigroup Inc. stopped redeeming ETF shares for clients after hitting its internal risk limits. Last year, two banks stepped away from a cannabis ETF after it changed custodians.Tighter balance sheets in the wake of the financial crisis have also encouraged some banks to scale back ETF trading. Electronic brokers have stepped in, but fears remain that they could back away in a volatile market, leaving funds to trade at a discount. Investors would still be able to sell, just not at the price they might like.“To say this is a foolproof mechanism,” Deshpande said, “let me just say, it needs to be tested.”To contact the reporters on this story: Rachel Evans in New York at email@example.com;Emily Barrett in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Jeremy Herron at email@example.com, Bob Ivry, Larry ReibsteinFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
BlackRock (BLK) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
(Bloomberg) -- When an Israeli developer of sophisticated smartphone-hacking software turned to Wall Street to finance a private-equity buyout, many debt investors found the company too toxic to touch. For some, including several collateralized loan obligation managers and BlackRock Inc., the deal was too good to pass up.Filings and trustee reports are painting a picture of which firms bought a piece of the roughly $500 million loan that helped finance the buyout of NSO Group, which licenses its technology to governments and intelligence agencies globally to fight terrorism and crime. Banks had to sell the debt at a steep discount amid accusations that NSO’s software had also been used by countries including Saudi Arabia to target human rights defenders, journalists and dissidents.Among the buyers: MJX Asset Management, Zais Group, Ellington Management Group and Saratoga Investment Corp. Those firms manage CLOs, which pool together risky loans and slice them into securities of varying risks. Mutual funds run by BlackRock and Principal Financial Group also bought a piece. Spokesmen for BlackRock, Ellington and Saratoga declined to comment, while representatives from MJX, Zais, and Principal Financial didn’t respond to requests for comment.Few TakersThe criticism of NSO comes at a time of increased scrutiny toward banks and asset managers over their business interests in controversial sectors, and amid rising demand for strategies that use environmental, social and governance criteria to screen investments. BlackRock itself has thrown its weight behind responsible investing by calling on chief executives to look beyond profits, and by pressuring gun makers in the wake of a deadly U.S. school shooting.Increased observance of such principles were a large reason that NSO found so few investors for its loan when it marketed the debt in March, people with knowledge of the matter said at the time.Demand was so scarce that Jefferies Financial Group Inc. and Credit Suisse Group AG were initially forced to come up with the cash themselves before they sold the debt to investors in April at just 90% of face value. Proceeds from the loan were used to fund the company’s buyout by private equity firm Novalpina Capital Group and NSO executives.NSO’s flagship software, known as Pegasus, is such a powerful tool that it’s licensed to foreign governments only with the approval of Israel’s Ministry of Defense, similar to an arms deal. Nevertheless, a United Nations expert last month called for an immediate moratorium on the sale of such products, depicting the private surveillance industry as a “free for all” causing “immediate and regular harm to individuals and organizations that are essential to democratic life.”Organizations including Amnesty International and Human Rights Watch have also criticized NSO’s business.NSO says that intelligence agencies and public safety officials rely on its software to combat increasingly tech savvy criminal enterprises, and that it has only identified three instances of client misuse in its history.“It’s not surprising a number of responsible investors have recognized this as well and have chosen to lend their weight behind a company that is working to make the world a safer place,” an NSO spokeswoman said in an email response to questions.BlackRock’s $4.6 million investment in NSO was made through its Event Driven Equity fund, which mostly makes bets on corporate events such as mergers and restructurings. The fund doesn’t have a specific mandate to incorporate ESG criteria in its investment process, nor do the funds managed by MJX, Zais, Ellington, Saratoga or Principal Financial.To contact the reporter on this story: Davide Scigliuzzo in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Natalie Harrison at email@example.com, Boris KorbyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Investors betting on Saudi Arabian shares are showing a clear preference for funds listed in Europe over the U.S. The contrasting picture may come down to which market offers lower fees and more attractive treatment on taxes and dividends.An exchange-traded fund focused on Saudi equities offered by BlackRock Inc. in New York since 2015, the year when the oil-rich kingdom started opening up to foreigners, drew net inflows of about $626 million this year, quadrupling in size from the end of 2018.Still, that’s dwarfed by the $1.5 billion that has poured into BlackRock’s London-listed ETF, which has very similar objectives but is only three months old. A London-listed fund run by Invesco Ltd. that was started last year has attracted $1.1 billion in 2019. Both European options are now bigger than their American predecessor.Saudi stocks have outperformed as index compilers including MSCI Inc. promote the biggest market in the Middle East and Africa to their major emerging-market benchmarks, spurring billions in purchases by passive investors. The New York and London ETFs are studded with large caps that will benefit from the upgrades and have become a favored option for individual investors placing a wager on the Saudi market.BlackRock started its London fund after “significant client demand for an exposure to take advantage of Saudi Arabia’s reclassification,” a spokeswoman for the world’s largest asset manager said in an emailed response to questions.As Saudi Arabia’s elevation by index compilers moves forward, investors could be favoring the European funds due to lower fees and the greater flexibility they offer in terms of dividend treatment, according to Louis Odette, an ETF analyst and strategist at Citigroup Inc. in London. Differences in withholding tax treatment may also play a role, he said.Some investors may also prefer funds run under European Union rules, according to Odette. “Operational preferences and familiarity with the UCITS framework can be relevant.”That acronym refers to Undertakings for Collective Investment in Transferable Securities, the 34-year-old framework of regulations for funds that are officially based and sold in the EU, but can be managed from New York, Hong Kong or elsewhere. The EU has set rules on funds’ liquidity requirements, risk limits, transparency and leverage, and UCITS products can use derivatives to create some leverage and short exposure, but not as much as traditional hedge funds.In the U.S., the Securities and Exchange Commission authorizes and regulates publicly traded funds under the Investment Company Act of 1940.Read a QuickTake about the regulation of funds in the U.S. and in Europe.Whatever the rules, ETF buyers in both markets have been rewarded for their investment. The main Saudi equities index, which advanced 0.6% on Wednesday, has climbed about 23% in the past two years, outperforming the MSCI emerging-market index six-fold.The gains in Riyadh stocks are partly thanks to foreigners, who have been net buyers of Saudi Arabian shares every week this year, a reversal from the sell-off in October triggered by U.S.-based columnist Jamal Khashoggi’s killing. Inflows have remained steady even as geopolitical tensions in the Gulf ticked higher after attacks on oil tankers since May.The Khashoggi incident and its market aftermath are a reminder to investors that buying Saudi assets isn’t a one-way bet.Saudi-focused exchange-traded funds offer the advantage of easy access to the upgrade story, and have “done a good job in attracting assets this year,” said Mohit Bajaj, director of ETFs at WallachBeth Capital in Jersey City. Still, “investors do tend to stray away from Middle East funds dependent on the political landscape.”(Updates index performance below second chart.)\--With assistance from Ksenia Galouchko.To contact the reporter on this story: Filipe Pacheco in Dubai at firstname.lastname@example.orgTo contact the editors responsible for this story: Celeste Perri at email@example.com, John Viljoen, Monica Houston-WaeschFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- BlackRock Inc.’s $14 billion Treasury ETF is fast becoming a weapon of choice for traders placing boom-to-doom bets on the fate of the world’s largest bond market.Outstanding options riding the iShares 20+ Year Treasury Bond fund, the world’s most heavily traded government debt product, are near the highest level this year. Bank of America Corp. and Macro Risk Advisors reckon bearish contracts on the long-dated ETF, or TLT, can buffer multi-asset investors from a bond tantrum as Wall Street frets the one-sided bull market.Investors betting on central-bank easing have pumped up long-dated Treasuries, leaving them vulnerable to a rapid downward spiral should sentiment reverse, like briefly happened Friday when a U.S. jobs report showed the economy might be healthier than bonds suggest.Duration, a measure of sensitivity to interest-rate changes, has soared to near all-time highs across sovereign debt markets. With options on TLT showing a lack of downside fear, they’re an easy hedge if things go pear-shaped.“Positioning in U.S. duration longs remains historically extreme,” BofA strategists led by Anshul Gupta wrote in a note. “Any negative shock to Treasuries could be exacerbated by crowded positioning.”The strategists recommend a TLT “collar,” an options trade that involves buying a bearish put on the fund that’s paid for by selling a bullish call. The thinking goes that it’s a costless trade with the only risk being that if Treasuries rally further, you’re on the hook to sell shares in the fund for less than what you’ve paid for them.For the call to expire in-the-money, the 30-year Treasury yield would have to fall to around 2.23% by mid-August from 2.53% today, according to the bank’s indicative trade.Global bonds yields have collapsed this year as central banks signal their next moves will more likely be to loosen than tighten policy. But a growing chorus on Wall Street is urging caution.Citigroup Inc. strategists are doubling down on their view these easing bets are overdone and that the Fed will take a “wait and see” approach at its July 31 meeting. JPMorgan Chase & Co. is warning against a possible “bond tantrum” sparked by depleted liquidity and vulnerable positioning.Macro Risk Advisors also recommends selling calls on TLT -- this time to fund bullish options on the SPDR S&P 500 ETF Trust, the world’s largest ETF.The market’s next test is tomorrow, when the Federal Reserve releases minutes of its June 19 meeting, and then in ensuing days as Fed Chair Jerome Powell faces Congress Wednesday and Thursday. He’s likely to leave cuts firmly on the table even though the latest U.S. jobs report dialed down the urgency to ease borrowing costs.Markets are pricing in a 25-basis point cut when Federal Reserve policy makers meet later this month. That puts equities in line for further gains as second-quarter earnings kick off in coming weeks, MRA quantitative strategist Maxwell Grinacoff wrote in a note.The trade performs best “when equities greatly outperform bonds,” according to Grinacoff. The biggest danger is a risk-off spell where rates continue to rally and stocks sell off.The recommendations highlight the growing role the world’s most liquid ETFs play for savvy managers versed in derivatives and keen to bet on macro developments. Earlier this year, another BlackRock fund -- ticker FXI -- became a go-to for navigating the trade war and China’s sputtering growth.To contact the reporter on this story: Yakob Peterseil in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Samuel Potter at email@example.com, Cecile Gutscher, Sid VermaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
BlackRock Inc NYSE:BLKView full report here! Summary * Bearish sentiment is low * Economic output for the sector is expanding but at a slower rate Bearish sentimentShort interest | PositiveShort interest is extremely low for BLK with fewer than 1% of shares on loan. This could indicate that investors who seek to profit from falling equity prices are not currently targeting BLK. Money flowETF/Index ownership | NeutralETF activity is neutral. The net inflows of $5.87 billion over the last one-month into ETFs that hold BLK are not among the highest of the last year and have been slowing. Economic sentimentPMI by IHS Markit | NegativeAccording to the latest IHS Markit Purchasing Managers' Index (PMI) data, output in the Financials sector is rising. The rate of growth is weak relative to the trend shown over the past year, however, and is easing. Credit worthinessCredit default swapCDS data is not available for this security.Please send all inquiries related to the report to firstname.lastname@example.org.Charts and report PDFs will only be available for 30 days after publishing.This document has been produced for information purposes only and is not to be relied upon or as construed as investment advice. To the fullest extent permitted by law, IHS Markit disclaims any responsibility or liability, whether in contract, tort (including, without limitation, negligence), equity or otherwise, for any loss or damage arising from any reliance on or the use of this material in any way. Please view the full legal disclaimer and methodology information on pages 2-3 of the full report.
BlackRock, the world's largest asset manager, on Monday downgraded emerging market equities linked to China for the second half of the year, saying markets were "overly optimistic" about China's ability to boost its economic growth amid the trade war with the United States.The firm, which manages more than US$6.5 trillion in assets, said it now sees "trade and geopolitical frictions as the principal driver of the global economy and markets" and expects China's economy to experience "a lull" from the effect of US tariffs.As recently as a month ago, New York-based BlackRock had a positive view of emerging market equities, saying "economic reforms and policy stimulus" could support the stocks.It had argued that "improved consumption and economic activity from Chinese stimulus could help offset any trade-related weakness".But the firm has now changed its viewpoint largely because the year-old US-China trade war has become the single most important factor in the global economy and marketplace, it said in its Midyear 2019 Global Investment Outlook, released on Monday.The US and China are now locked in a strategic competition that is structural and persistent, BlackRock's researchers said.The tensions go beyond trade, extending to a race to dominate next-generation technologies with implications for national security."China's growth is finding its footing but looks to be at risk of staying sluggish due to the tariff fallout," said Jean Boivin, head of BlackRock Investment Institute, which provides insights on the global economy and asset allocation to help clients and portfolio managers navigate financial markets.While Boivin said he expects Beijing to be "quick to roll out fiscal stimulus to help underpin growth if the economy wobbles", he said any stimulus will be "to stabilise growth, but not to accelerate it".Although it has a positive second-half view on US stocks, BlackRock now advises investors to avoid emerging market equities. It recommends they instead "dial down overall risk by raising some cash".While Chinese policymakers are expected to revert to trusted tools to boost growth, such as infrastructure spending and other fiscal stimulus, Boivin said that a significant monetary easing or sharp currency depreciation was "unlikely".Such measures "would run counter to Beijing's prime objective to maintain financial stability and prevent a rerun of the destabilising capital outflows seen in 2015-2016", he said.The fallout from the trade war would be a potential rollback of the decades-long globalisation trends in China that gradually lowered inflation and expanded corporate profit margins.If the result were a supply shock for which markets were not prepared, it could lead to negative returns in both equities and bonds, the researchers said.A port and logistics hub in Lianyungang, Jiangsu province. The tensions between the US and China go beyond trade, extending to a race to dominate next-generation technologies. Photo: EPA-EFE alt=A port and logistics hub in Lianyungang, Jiangsu province. The tensions between the US and China go beyond trade, extending to a race to dominate next-generation technologies. Photo: EPA-EFE"Yet we see the gradual opening up of China's onshore markets " and their increasing weight in global bond and equity indexes " as important sources of diverse returns for investors in the medium term," Bartsch said.Despite the weakened outlook for China, BlackRock still sees investment opportunities in emerging markets such as Brazil.The firm also downgraded its global growth outlook for the second half of the year, saying the trade war could further weaken spending.BlackRock cut its global growth forecast last year as the trade war picked up steam.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.
A recent report from the European Systemic Risk Board says the increased use of ETFs may pose a risk during periods of financial stress. But that may not be the case.
BlackRock Real Assets has reached an agreement with Greenbacker Renewable Energy Corporation for the sale of its controlling interest in Community Wind South , a 30.75 MW community-based operating wind project in Minnesota.
(Bloomberg Opinion) -- The world’s biggest brewer may be calling time on a long-established practice in Hong Kong’s stock market.The Asian unit of Anheuser-Busch InBev NV is aiming to raise as much as $9.8 billion in what’s poised to be the world’s biggest initial public offering so far this year. Unusually for a deal of this size, the company doesn’t plan to reserve a block of stock for so-called cornerstone investors. That’s good news for potential subscribers concerned that the business may lose its fizz after listing.Cornerstone investors are companies, institutions or wealthy individuals that commit to buying a chunk of stock at the IPO price and holding it for a minimum period, typically six months. The presence of such heavyweights helps to ensure the success of a sale by signaling confidence in the issuer’s prospects and enticing the wider investing public to climb on board. Associated mostly with Chinese state-owned firms in recent years, cornerstones have a long pedigree in Hong Kong, with billionaire tycoons such as Li Ka-shing, the city’s richest man, and Lee Shau-kee frequently called on to provide a seal of approval for key IPOs.The trouble with cornerstones is that they drain liquidity by tying up so much stock after listing. They’re disliked by bankers, lawyers and some investors. It’s debatable whether they even serve companies, beyond the immediate objective getting their offerings through the gate. If trading proves moribund once they’ve joined the market, the end-game can be a withdrawal of the listing.So market participants are watching Budweiser Brewing Company APAC Ltd. closely. The absence of cornerstones means there will be a battle of wills between believers who see the IPO as a chance to buy into a company in a high-growth region with a lock on China’s taste for premium beer, and skeptics who view the offering as overpriced. The valuation looks punchy, at 22 times estimated Ebitda for 2019 at the top of the mooted range, as my colleague Chris Hughes observed last week.The distorting effect of cornerstone investors has arguably grown bigger as Hong Kong tycoons have taken a back seat and Chinese state-owned enterprises, which may have a less commercial rationale for such purchases, have increased their presence. Out of 36 IPOs in the past five years that raised more than $1 billion, 33 had a cornerstone tranche, according to data compiled by Bloomberg. Postal Savings Bank of China Co., which raised $7.62 billion in 2016, sold almost 77% of its offering to cornerstones including China Great Wall Asset Management, China State Grid Corp. of China, and conglomerate HNA Group Co.All the top 10 biggest cornerstone tranches in that group were for Chinese government companies. In April, state-backed brokerage Shenwan Hongyuan Group Co. raised $1.15 billion, with 71% of the deal locked up. The company’s shares have fallen 27% since they started trading. Postal Savings has lost 1.5% since listing, versus a 22% gain for the benchmark Hang Seng Index.Private companies also use cornerstones, though they tend to allocate lower percentages. Smartphone maker Xiaomi Corp. earmarked 24% of its $5.4 billion IPO last year to 10 investors including Hillhouse Capital and Alibaba Group Holding Ltd. Xiaomi shares slumped on the day the six-month holding period ended, accelerating a decline that began when they started trading.Lack of liquidity may be an even bigger concern, and it isn’t confined to Chinese companies. Glencore International Plc, the world’s largest listed commodity trader, sold stock to cornerstone investors including BlackRock Inc. and Abu Dhabi’s Aabar Investments PJSC when it listed in London and Hong Kong in 2011. The company delisted from Hong Kong six years later, saying trading in the stock was a fraction of the U.K. equivalent.Singapore-based video-gaming firm Razer Inc. sold almost 30% of its 2018 offering to cornerstone investors. But other non-Chinese companies including Prada SpA, L’Occitane International SA and Samsonite International SA have eschewed the practice.A successful Budweiser sale would deal a further blow to the cornerstone custom. AB InBev executives and bankers said Thursday that they had enough investor demand just two days into the IPO roadshow. That should rouse a chorus of cheers from many in the Hong Kong market.\--With assistance from Zhen Hao Toh. To contact the author of this story: Nisha Gopalan at email@example.comTo contact the editor responsible for this story: Matthew Brooker at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Nisha Gopalan is a Bloomberg Opinion columnist covering deals and banking. She previously worked for the Wall Street Journal and Dow Jones as an editor and a reporter.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
For two decades the same faithful taxi driver has arrived at Rachel Lord’s north London home at 7am sharp daily to take her to work. If Driving Ms Lord were a film, it would tell the story of an Essex-born, University of Leeds-educated woman who ditched a long and patchy career in banking to join the world’s biggest money manager. In record time, the former chartered accountant would rise to the pinnacle of the European fund industry, overseeing an investment empire managing nearly 5,000 people and $1.76tn, a larger sum than any of her peers.
BlackRock’s Mark Wiseman on why investors need to think like owners, why boards need to do a better job, and why everyone should worry about climate change.
(Bloomberg) -- Veteran investor Mark Mobius says that gold’s set to push higher, potentially topping $1,500 an ounce, as interest rates head lower, central banks extend purchases, and uncertainty surrounding geopolitics and cryptocurrencies fans demand.“I love gold,” Mobius, who set up Mobius Capital Partners LLP last year after three decades at Franklin Templeton Investments, said in an interview in Singapore, adding bullion should always form part of a portfolio, with a holding of at least 10%. “As these interest rates come down, where do you go?”Gold has rallied in 2019, rising to the highest level in six years, as investors contemplate slowing economic growth, prospects for easier monetary policy in the U.S. and Europe and festering trade frictions. The upswing has been given added momentum as central banks, including authorities in Russia and China, step up purchases. A revival in cryptocurrencies may lead to spillover demand from investors for the older haven, according to Mobius.“Interest rates are going so low, particularly now in Europe,” he said. “What’s the sense of holding euro when you get a negative rate? You might as well put it into gold, because gold is a much better currency.”Spot gold -- which hit $1,439.21 an ounce on June 25, the highest since 2013 -- traded at $1,413.50 on Thursday. It’s up 10% this year after the Federal Reserve signaled a willingness to cut rates and other central banks considered fresh stimulus. It last topped $1,500 in April 2013.Mobius isn’t the only high-profile gold fan as prices climb. Billionaire trader Paul Tudor Jones has listed the metal as his favorite pick over the next 12-to-24 months, saying that prices could move to $1,700 once they breach $1,400. BlackRock Inc. said last month it expects bullion to end the year higher.(Updates with outlooks from Tudor Jones, BlackRock in final paragraph.)To contact the reporter on this story: Ranjeetha Pakiam in Singapore at email@example.comTo contact the editors responsible for this story: Phoebe Sedgman at firstname.lastname@example.org, Jake Lloyd-Smith, Keith GosmanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.