BBH has released their 2020 survey on ETFs: their selection, investment strategies, and how investors access ETF products. Shawn McNinch, Brown Brothers Harriman Managing Director, Head of ETF joins On The Move to discuss the details.
BBH has released their 2020 survey on ETFs: their selection, investment strategies, and how investors access ETF products. Shawn McNinch, Brown Brothers Harriman Managing Director, Head of ETF joins On The Move to discuss the details.
Malaysia on Wednesday said the U.S. Department of Justice has returned 1.9 billion ringgit ($460.22 million) of funds recovered from assets related to sovereign fund 1Malaysia Development Berhad (1MDB). Malaysian and U.S. investigators say at least $4.5 billion was stolen from 1MDB between 2009 and 2014, in a wide-ranging scandal that has implicated high-level officials, banks and financial institutions around the world. The United States has been returning funds it has recovered from seized assets that were allegedly bought with stolen 1MDB money.
Oil prices rose to an eightweek high on Wednesday as U.S. crude exports plunged and on signs of a speedy economic recovery and upbeat forecasts for energy demand.
Airbus is asking key suppliers to get ready for a further 18% increase in A320-family jet output by the end of 2022, on top of existing targets for this year, as airlines eye a partial return to normal travel, industry sources said. The tentative new planning goal would lift output of the workhorse domestic and medium-haul jet, which competes with Boeing's 737 MAX, to 53 a month, they told Reuters. The number being floated for the end of next year remains informal and Airbus has only committed so far to raising output in two steps to 45 a month by the end of 2021, from 40 now.
(Bloomberg) -- Discover what’s driving the global economy and what it means for policy makers, businesses, investors and you with The New Economy Daily. Sign up here.Money markets are wagering on an increase in Bank of England borrowing costs as soon as next year, having only recently erased bets on negative rates.Traders now see 15 basis points of tightening in September 2022. That’s a sharp turnaround from the second half of last year, when traders were contemplating rates of as low as minus 0.1% after the central bank said it was studying the feasibility of such a move. They only removed bets on further loosening in February, when policy makers stressed that negative rates are not imminent as the U.K.’s vaccine rollout transformed the nation’s monetary policy debate. A larger-than-expected increase in U.S. consumer prices on Wednesday triggered a global rates selloff, sending benchmark gilt yields to their highest level in around two months and spurring traders to bring forward their expectations for a BOE rate hike.The central bank traditionally shifts its key interest rate by multiples of 25 basis points, though it cut rates by 15 basis points in March 2020, at the height of the coronavirus pandemic. If officials wanted to tighten financing conditions, a move back to 0.25% is seen by strategists as a plausible first step.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The Fed is going to deny that is an issue. "The market's concerned there's risk the Fed might make a policy mistake by ignoring inflation and this inflationary spike might last a lot longer than we think." One, there are valid valuation concerns as the run-up (for tech stocks) has been significant.
BRUSSELS (Reuters) -Amazon won its fight against an EU order to pay about 250 million euros ($303 million) in back taxes to Luxembourg in a blow to competition chief Margrethe Vestager's crusade against preferential deals. The setback renewed calls from EU lawmakers for a global corporate tax deal and legal analysts said Vestager was unlikely to give up her pursuit of large companies over the amount of tax they pay. The bloc failed to show that Luxembourg had given the U.S. online retailer special treatment in violation of state aid rules, the EU's General Court ruled on Wednesday.
(Bloomberg) -- ABN Amro Bank NV posted a loss in the first quarter on a slump in lending income and a fine for weak money-laundering controls. The shares slid the most in more than five months.The net loss in the three months through March was a bigger-than-expected 54 million euros ($65.5 million) after a loss of 395 million euros a year earlier. That wiped out gains made by releasing 77 million euros from its credit loss reserves.The money laundering probe by Dutch authorities has weighed on ABN Amro as it overhauls its business to focus on retail and commercial banking and dangles the prospect of returning its high levels of excess capital to investors. The lender joined European rivals in taking a rosier view of the economic fallout from the pandemic, saying it expects the Dutch economy should rebound in the second half.Lending income slid 11% to 1.36 billion euros in the first quarter from a year earlier as ABN Amro shrank its corporate and investment bank to reduce risk. The bank said it partly offset the hit from low interest rates by lowering the threshold for charging for deposits.ABN Amro fell as much as 8.6%, the most since November. The stock was down more than 6% at 10.31 euros as of 9:22 a.m. in Amsterdam.The bank’s net interest income missed analysts’ expectations and the trends for that source of revenue “remain challenging,” according to Citigroup Inc.ABN Amro said it expects loan loss provisions excluding operations it is exiting to be “at or below the through-the-cycle guidance of 25-30 basis points” this year. Impairments at the corporate and investment banking businesses “remain uncertain but are expected to be significantly below last year.”ABN Amro said the pressure on lending income was only partly offset by passing on negative interest rates to a wider base of clients. The bank said it has charged clients with deposits in excess of 500,000 euros a -0.5% interest rate since January and will start charging clients with deposits over 150,000 euros the same rate from July 2021.Investment Bank RetreatChief Executive Officer Robert Swaak, a former PwC Netherlands chairman with experience advising organizations on know-your-customer and anti-money-laundering initiatives, was appointed to the role last year to help the lender move past the probe as well as a tax scandal. He is retreating from large parts of the investment banking business as he focuses on cost cutting and digitization.ABN Amro’s personnel expenses rose as it added 182 staff in the three months through March, primarily to bolster its money-laundering controls. The bank said it currently has about 4,300 employees working on the issue and that associated costs should peak at about 425 million euros this year before falling to about 370 million in 2023.While the bank scrapped its dividend for 2020 after posting a loss, it plans to reward shareholders with 639 million euros originally set aside based on profit for 2019 after the European Central Bank lifts restrictions on payouts at the end of September. It will also recalibrate the capital threshold it uses for determining whether to buy back shares in the fourth quarter.ABN Amro posted a loss in the first quarter of last year after the collapse of a Singapore oil trading giant as well as a U.S. client’s failure to meet risk and margin requirements amid market volatility caused by the pandemic.(Updates with shares starting in first paragraph, analysts in sixth)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
In breaking news, inflation accelerated at its fastest pace in more than 12 years for April as the U.S. economic recovery kicked into gear.
With a cyberattack temporarily hobbling the critical Colonial Pipeline, the prospect of gas shortages in the Southeast is making some nervous.
Investing is all about profits, and part of generating profits is knowing when to start the game. The old adage says to buy low and sell high, and while it’s tempting just to discount cliches like that, they’ve passed into common currency because they embody a fundamental truth. Buying low is always a good start in building a portfolio. The trick, however, is recognizing the right stocks to buy low. Prices fall for a reason, and sometimes that reason is fundamental unsoundness. Fortunately, Wall Streets analysts are busy separating the wheat from the chaff among the market’s low-priced stocks, and some top stock experts have tagged several equities for big gains. We’ve used the TipRanks database to pull up the data and reviews on three stocks that are priced low now, but may be primed for gains. They’ve been getting positive reviews, and despite their share depreciation, they hold Buy ratings and show upwards of 80% upside potential. Vapotherm, Inc. (VAPO) First up, Vapotherm, is a medical device manufacturer, specializing in heated, humidified, high-flow nasal cannulas. These are therapeutic breath aids, designed to deliver oxygenated air directly to the patient’s nose. Heating and humidifying the air reduces the discomfort of delivering dry oxygen. As can be expected, during a pandemic of a respiratory illness, Vapotherm saw high sales in recent months – but the share price has pulled back since early February. Paradoxically, the two events are related. First, on the positive side, Vapotherm’s 1Q21 financial results were solid. The company’s revenue, at $32.3 million, was up 69% year-over-year, and worldwide, installations of the Precision Flow base unit was up 73% over the same period. The company’s net loss in the quarter, $5.2 million, was an improvement from the $10.2 million loss in the year-ago quarter. On the negative side, VAPO shares are down from their early-February peak. The drop is substantial; the stock has fallen 50% from its peak, and is down 34% year-to-date. The fall in share value reflects concerns that the company’s flagship product is oversold, that customers, fearful of COVID-related respiratory emergencies, bought more units that would be needed in ordinary times. This is the case made by Piper Sandler analyst Jason Bednar. “Shares have meaningfully underperformed since early February as many investors have questioned utilization dynamics for the bolus of Precision Flow systems that were sold into hospitals last year… We understand the logic here, particularly for those investors with a shorter time horizon, but with much of that concern seemingly already reflected in the stock at current levels we do believe the upside opportunity meaningfully outweighs the risk of further downside,” Bednar noted. The analyst added, "It’s also our view that investors who wait for utilization trends to bottom out will ultimately miss an initial move higher that could come as HVT 2.0 begins to contribute with a rollout later this year and as market expanding opportunities for HVT 2.0 in 2022 begin to take on a more defined shape (particularly EMS and home-based care)." To this end, Bednar rates VAPO an Overweight (i.e. Buy), and his $32 price target implies a robust upside of 81% in the year ahead. (To watch Bednar’s track record, click here) Overall, the unanimous Strong Buy consensus rating on this stock, supported by 4 recent analyst reviews, makes it clear that Bednar is not alone in his bullish view. The average price target here, $39, is even more optimistic, suggesting an upside of ~122% from the current trading price of $17.65. (See VAPO stock analysis on TipRanks) Emergent Biosolutions (EBS) The next stock we’re looking at, Emergent, is a biopharmaceutical company. The company has multiple products on the market, including a NARCAN nasal spray for use on opioid overdose patients, and vaccines against smallpox, anthrax, and other diseases. Emergent’s development pipeline includes a pediatric cholera vaccine, Vaxchora, currently in a Phase III trial. Several programs, including an anthrax vaccine candidate, a Chikungunya vaccine, and a seasonal flu shot, have all completed Phase II and are in preparation for Phase III. One of Emergent’s most important programs is in its Contract Development and Manufacturing service, a service extended to other pharmaceutical companies to manufacture vaccines which they have developed. Under a CDMO plan, Emergent is part of Johnson & Johnson’s manufacturing chain for a COVID-19 vaccine. That last is a key point. The J&J vaccine has been linked – at least in some reports – to serious adverse events, particularly blood clots in otherwise healthy recipients. That has caused a hold in manufacturing of the vaccine, and consequently a delay in receiving payments from J&J. Which, in turn, impacted the company’s 1Q21 financials, resulting in lower revenues and earnings than expected. Investors are concerned, and the stock has fallen 33% year-to-date. Despite the setback, Benchmark analyst Robert Wasserman keeps a Buy rating on EBS shares, along with a $120 price target. If correct, the analyst’s objective could deliver one-year returns of 101%. (To watch Wasserman’s track record, click here) "EBS remains solidly profitable, and even with the lowered expectations for J&N and AZ vaccine contracts, is expected to show solid revenue growth for this year. These shares remain a bargain in our CDMO/bioprocessing group and could offer significant upside for value-oriented investors if circumstances turn around or new business can be garnered in the near-term," Wasserman opined. Overall, the Street currently has a cautiously optimistic outlook for the stock. The analyst consensus rates EBS a Moderate Buy based on 3 Buys and 2 Holds. Shares are priced at $59.59, and the average price target of $89.67 suggests an upside potential of ~50% for the next 12 months. (See EBS stock analysis at TipRanks) Haemonetics Corporation (HAE) For the last stock on our list, we’ll stick with the medical industry. Haemonetics produces a range of products for blood and plasma collection and separation, as well as software to run the machines and service agreements for maintenance. In short, Haemonetics is a one-stop shop for blood donation centers and hospital blood banks. Blood products is a $10.5 billion market in the US alone, with plasma accounting for 80% of that, and Haemonetics has made itself an integral part of that business. Haemonetics had been recovering steadily from a revenue dip at the height of the corona crisis, and its 3Q fiscal 2021 earnings showed a solid results: top line revenue of $240 million and EPS of 62 cents. While the revenue was down 7.3% yoy, EPS was up 6.8%. Even with that, however, the stock dropped sharply between April 15 and April 20, losing 42% of its value in that short time. The reason was simple. One of Haemonetics’ largest customers, CSL Pharma, announced that it does not plan to renew its contract with HAE. That contract, for supply, use, and maintenance of Haemonetics’ PCS2 plasma collection system, was worth $117 million and made up approximately 12% of the company’s top line. The cancellation comes with a one-time charge of $32 million in other related losses. Fortunately for HAE, the CSL contract does not expire until June of 2022, giving the company time to plan and prepare. Covering the stock for JMP Securities, analyst David Turkaly noted: “The advance notice gives HAE some time (~15 months) to prepare for the expiration, and we note that management has consistently strengthened its financial position using levers such as complexity reduction and product optimization to derive significant cost savings, and more of these will likely be employed ahead to help offset the customer loss.” The analyst continued, "While this disappointing decision could impact HAE's plasma positioning with other fractionators, we continue to believe that giving customers the ability to collect more plasma in less time is a very compelling value proposition - and HAE still has contracts and maintains significant market share with many of the most relevant plasma players." Accordingly, Turkaly rates HAE an Outperform (i.e. Buy), and sets a $110 price target. This figure implies an upside of 86% from current levels. (To watch Turkaly’s track record, click here) All in all, HAE has a Moderate Buy consensus rating, based on 7 reviews that break down 5 to 2 in favor the Buys over the Holds. The stock is trading for $59.02 and carries an average price target of $108.67, which suggests ~84% one-year upside. (See HAE stock analysis at TipRanks) To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
Need more relief? The White House says that's up to Speaker Pelosi and company.
Wendy's light its up in the first quarter. Here's why.
Economists are puzzled by the hiring problems that John Deere, long one of Iowa's premier employers, is having at a time when thousands are unemployed
(Bloomberg) -- Few things evoke fear in equity markets like a margin call. On Wednesday that fear turned into panic in Taiwan, offering another warning for the world on what can happen when leverage unwinds.The trading day started out quiet in Taipei’s $2 trillion stock bourse. But before the morning was over, the local benchmark index had plummeted almost 9% in the worst one-day performance in its 54-year history.There were reasons to sell. New data showed a worsening Covid-19 outbreak in an island where almost no one is vaccinated. A deepening slump in global tech shares also undermined the appeal of a market dominated by the industry. But the swiftness of the plunge that followed suggests bigger forces were at play.For months, bull market skeptics around the world have warned that surging leverage is making equity markets riskier -- and the blowup of Archegos Capital Management in March served as a reminder of that. Yet stocks have continued to rise, with the MSCI All-Country World Index closing at a record as recently as Friday. In the U.S., margin debt topped $822 billion by the end of March -- the latest available data. That’s up 72% year on year.On a smaller scale, the same happened in Taiwan. Armed with conviction, and with history on their side, investors took on increasing amounts of leverage. The result was a 46% expansion in margin debt this year to about NT$274 billion ($9.8 billion) two weeks ago, the highest since 2011. By comparison, the Taiwan benchmark was up just 19% in that period, an indication that people were taking out loans faster than stocks were appreciating.Local investors had little reason to fear losses. Taiwan’s economy became one of the biggest winners from U.S.-China rivalry. Its chipmakers flourished as Washington sought to hobble Beijing’s efforts to build a domestic chip industry. During President Donald Trump’s four-year term, the Taiex benchmark became the world’s best performing stock gauge, gaining more than 90% in U.S. dollar terms.Gains extended this year as the pandemic created a shortage of chips, with the index rising for seven straight months through April.The euphoria began to unravel this week as the threat of inflation sank the Nasdaq, with tech stocks around the world following suit. As the Taiex slid 3.8% on Tuesday in Taiwan, the level of margin debt fell by NT$12.6 billion, the most since October 2018. That suggests traders faced margin calls by brokers to cover losses in their stock accounts.Wednesday’s record rout is likely to have spurred a bigger unwinding of leverage. (Comparatives are skewed by the widening of daily price limits for individual stocks in 2015.)“Margin trading boosted the Taiex over the past few months, which may add to declines if they face margin calls,” said MasterLink Securities Investment Advisory President Paul Cheng.The fear of further losses was evident in a stock market where individual investors account for about 60% of transactions. The derivatives market burst with activity: more than 1.75 million options tracking the Taiex changed hands on Wednesday, the third-busiest day since 2016. Traders snapped up bearish contracts even as dozens of short-term options expired, with the price of one put surging as much as 7,757%.KGI Securities’ trader Kevin Lee, who has been a local stocks trader for a decade, said clients started to panic as the morning wore on.“There were non-stop orders coming in,” Lee said. “Investors were crazy as there were lots of news during trading hours and we didn’t know if they were true or not.”By the end of the day, the index had pared its losses to 4.1%. But the damage to investor confidence was already done.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The fast-food chain raised its annual forecast for earnings on Wednesday wagering that more customers would be trying its bacon-filled breakfast menu
(Bloomberg) -- Oil rose as a weaker dollar lent support and offset a burgeoning pile up of crude in the U.S. Gulf Coast as refineries there cut runs in response to the Colonial Pipeline shutdown.Crude futures in New York rose less than 1% Tuesday. The dollar has traded steadily weaker, making commodities priced in the currency more attractive.Colonial Pipeline Co. is working to restart its oil-products system, the largest in the U.S., after a cyberattack shuttered operations. While gasoline stations from Alabama to Virgina report shortages, refiners in the U.S. Gulf are reducing output to avoid a glut in the absence of the pipeline. Some refiners have already chartered ships to store refined products offshore.“The dollar index trading lower explains the slight increase in oil prices,” said Bob Yawger, head of the futures division at Mizuho Securities. The weak dollar may have saved the day for crude oil, which was facing pressure from refiners being forced to store barrels they can’t feed into the pipeline, he said.U.S. crude oil prices are up 2.7% so far this month even with coronavirus-induced demand concerns, particularly in India, limiting rallies. Still, the Organization of Petroleum Exporting Countries on Tuesday lifted its forecast for the amount of crude it will need to produce and the group now sees a small decline in U.S. supplies this year, mostly due to the Texas freeze in February.Traders are expecting “a gradual resolution to the Colonial Pipeline shutdown,” according to Louise Dickson, an analyst at consultant Rystad Energy. “The market is again looking to Asia, Covid-19 cases, and the next signals for oil demand outlook.”Meanwhile, the knock on impact of the Colonial disruption is rippling through to everything from refining to shipping. Among processors, Total SE scaled back activity in a key unit at its Port Arthur, Texas, refinery, and Citgo Petroleum Corp. also cut rates at its Lake Charles, Louisiana, plant. There’s been a rush to book oil tankers as traders seek to redress the supply imbalance caused by the stoppage.“We are far from out of the out of the woods with the Colonial situation,” said Kilduff. “A scare among consumers is increasingly likely, where a run on gas stations may develop more broadly, especially if there is no resolution by the end of the week.”The U.S. East Coast has lost about 3.6 million barrels of gasoline supply due to the Colonial Pipeline disruption, with the region losing an additional 1.2 million barrels each day the outage continues, according to FGE.See also: India’s Oil Demand Spared 2020’s Collapse Despite CrisisIn the U.S., crude supplies are expected to have dropped last week, according to a Bloomberg survey. The industry-funded American Petroleum Institute will report its supply tally later Tuesday, while government data will be released on Wednesday.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Some of your favorite consumer brands want more of your money because of surging inflation.
Legally, the term is “expatriate.” The problem for Americans living in another country is that they must continue paying tax on their worldwide income. Merely departing the United States isn’t enough to end worldwide taxation, because U.S. citizens are taxed no matter where they reside.
Exec departs after a 14-year career.
(Bloomberg) -- Commerzbank AG posted a surprise profit in the first three months and upgraded its full-year revenue outlook, providing support to Chief Executive Officer Manfred Knof after he unveiled a new turnaround strategy to boost profitability.Revenue soared 35% in the first quarter after the bank joined peers in profiting from strong trading and investment banking conditions. That helped drive net income to 133 million euros ($161 million), compared with a forecast loss of 53 million euros. Full-year revenue should be slightly above that of 2020, compared with earlier estimates of a decline.The earnings are the first overseen by Knof, who joined the lender in January and quickly presented a four-year turnaround plan centered around cutting about a fifth of its costs and a quarter of the domestic workforce. The bank benefited from an increase in net commission income in the quarter, while a 126 million-euro benefit from the European Central Bank’s targeted longer-term loan program helped offset pressure on net interest income.The bank for now is sticking with its guidance for a full-year loss, though the first-quarter performance has increased chances it may post a profit after all, Chief Financial Officer Bettina Orlopp said on a call with journalists. She will wait until after the second quarter before deciding whether to change the guidance, she said.The results are “the first tangible signs of restructuring success,” Bloomberg Intelligence analysts Philip Richards and Mar’Yana Vartsaba wrote in a note. That’s “raising confidence in the credibility” of the bank’s long-term profitability goal, they wrote. The lender is targeting a return on tangible equity of about 7% for 2024.Commerzbank rose as much as 8.9% in Frankfurt trading and was 6.5% higher as of 12:10 p.m. local time.While the beat is a boost for Knof, it also highlights the challenges for his strategy lying ahead. He has slated one of the best-performing units this quarter, the capital markets business, for cuts.The strong showing of securities trading is also reminiscent of results at crosstown rival Deutsche Bank AG, which also boosted its full-year revenue outlook on the back of first-quarter results at its trading unit. The strong performance of the business throughout the second half of last year has led CEO Christian Sewing to pin higher expectations on it, while downgrading other units after a deep restructuring kicked off two years ago.Costs for soured loans at Commerzbank fell more than half from a year earlier, and the bank said the annual total would likely be in the lower half of its expected range of 0.8 to 1.2 billion euros. It also lifted the full-year outlook for its capital buffer, known as the Common Equity Tier 1 ratio, to at least 12.5%, from more than 12%.“We expect a further increase” of corporate defaults in Germany after they ticked up in the first quarter, Orlopp said in a Bloomberg TV interview with Matthew Miller on Wednesday. But she also said she’s not expecting “real difficulties for our clients” and highlighted growing confidence in Germany’s economic recovery.Commerzbank last week increased the expected costs of the turnaround plan to slightly over 2 billion euros after an agreement with the lender’s workers council on the job cuts was more expensive than previously anticipated. On Tuesday, the bank unveiled an agreement to outsource its equities trading and research to the French bank Oddo BHF as another element of its strategy.As part of the agreement with Oddo, Commerzbank will stop producing its own institutional equity research “over the long term,” it said. The arrangement could affect close to 100 jobs at the German lender, Bloomberg has reported.The corporate clients unit under Michael Kotzbauer is set to shrink this year as Commerzbank pulls out of several countries and severs ties with clients not seen as lucrative enough. Instead, it will focus more strongly on its clients among Germany’s middle-sized companies.(Adds CFO comment in fourth paragraph, updates shares in sixth. An earlier version corrected the year in the second paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.