Feb.18 -- On Bloomberg Equality today, Melissa Guzy, co-founder and managing partner at Arbor Ventures, discusses fintech, funding and female representation in the venture capital industry. She speaks with Bloomberg Live's Mallika Kapur.
Feb.18 -- On Bloomberg Equality today, Melissa Guzy, co-founder and managing partner at Arbor Ventures, discusses fintech, funding and female representation in the venture capital industry. She speaks with Bloomberg Live's Mallika Kapur.
Major global stock indexes scaled new peaks on Wednesday after upbeat U.S. and European earnings pointed to a strong recovery from the coronavirus pandemic, while the dollar dipped to three-week lows as Treasury yields held below recent highs. High-flying growth stocks declined on Wall Street, sending the benchmark S&P 500 and Nasdaq lower in afternoon trade, while underpriced value stocks rose, lifting the Dow to a new record. U.S. import prices increased more than expected in March, lifted by higher costs for petroleum products and tight supply chains in the latest data to show inflation is heating up as economies reopen.
Gold fell on Wednesday as an uptick in U.S. Treasury yields weighed on bullion's appeal, while investors awaited speeches by several Federal Reserve officials in the wake of data showing higher inflation. Spot gold fell 0.3% to $1,739.00 per ounce, as of 10:45 a.m. EDT (1445 GMT). The uptick in bond yields seem to be "adding some very light pressure to the (gold) market," said David Meger, director of metals trading at High Ridge Futures.
Gold may have risen following the release of the CPI data, but it was not because of concerns over inflation.
(Bloomberg) -- New Zealand’s central bank signaled it is in no rush to remove monetary stimulus, saying the outlook remains uncertain as the economy gradually recovers from the Covid-19 pandemic.The Reserve Bank’s monetary policy committee on Wednesday maintained its current stimulatory settings, holding the official cash rate at 0.25% and the Large Scale Asset Purchase program at NZ$100 billion ($71 billion). It reiterated it is prepared to lower the cash rate further if required.“The committee agreed that, in line with its least regrets framework, it would not remove monetary stimulus until it had confidence that it is sustainably achieving the consumer price inflation and employment objectives,” the bank said. “Given that uncertainty remains elevated, gaining this confidence is expected to take considerable time and patience.”Policy makers are assessing whether an expected pick-up in inflation this year will be sustained, and whether the labor market’s gradual recovery will be hurt by the possibility of a double-dip recession. At the same time, the government now requires the RBNZ to consider the impact of its decisions on New Zealand’s housing market, where soaring prices are raising concerns about widening social inequalities.“The New Zealand economy is evolving broadly in line with RBNZ expectations, and there’s time to see how more recent developments impact things,” said Sharon Zollner, chief economist at ANZ Bank New Zealand in Auckland. “The RBNZ is under no pressure to make any bold calls about how precisely things will turn out.”The New Zealand dollar rose after the statement. It bought 70.88 U.S. cents at 3:21 p.m. in Wellington, up from 70.60 cents beforehand.The RBNZ said the outlook for growth remains similar to the scenario it presented in its last statement in February. It said inflation is likely to exceed its 2% target “for a period” but this is likely to be temporary.“This outlook remains highly uncertain, determined in large part by both health-related restrictions, and business and consumer confidence,” it said. “The committee agreed that medium-term inflation and employment would likely remain below its remit targets in the absence of prolonged monetary stimulus.”New Zealand’s economy has enjoyed a V-shaped recovery from its pandemic-induced recession and the housing market is booming, turning attention to when the RBNZ might begin to remove stimulus. The jobless rate fell to 4.9% in the fourth quarter and the central bank in February forecast that inflation will accelerate to 2.5% by June, exceeding the midpoint of its target range.Double-Dip Recession?Still, the economy unexpectedly contracted 1% in the final three months of 2020 and economists see little or no growth in the three months through March, raising the prospect of a double-dip recession.Some analysts are tipping the RBNZ will explicitly start to reduce its bond buying later this year, with a minority already projecting rate rises in 2022. But others see the central bank on hold for a prolonged period after the government in March announced a raft of measures to cool the rampant housing market, including tax adjustments to curb investor demand.The RBNZ said the extent of the dampening effect of the government’s new housing policies on house prices, and hence inflation and employment, will “take time to be observed.”New Zealand will start to allow travelers from Australia to enter the country without undergoing quarantine from April 19, which may deliver some relief for a decimated tourism industry. But the border is expected to remain closed to all other foreigners throughout 2021, and the country won’t start mass immunization until the second half.“The planned trans-Tasman travel arrangements should support incomes and employment in the tourism sector both in New Zealand and Australia,” the RBNZ said. “However, the net impact on overall domestic spending will be determined by the two-way nature of this travel.”In late February, the government instructed the RBNZ to consider the impact on housing when it makes monetary and financial policy decisions. Specifically, the monetary policy committee will to need to explain regularly how it has sought to assess the impacts of its decision on housing outcomes, Finance Minister Grant Robertson said at the time.“The committee’s initial assessment is that stimulatory monetary policy is playing a role in lifting house prices,” the bank said today. “Other factors are also influencing house prices including: the impact of low global interest rates on all asset prices, constrained housing supply and infrastructure, land use regulations, tax policies and the broader recovery in aggregate demand.”(Updates with economist in fourth 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.
(Bloomberg) -- Federal Reserve officials are just as worried about an inflation rate that runs too cold as one that runs too hot.While rising prices are in the spotlight now as the economy reopens and demand surges, the longer-run trends that have suppressed costs globally could re-emerge as the pandemic ends, some policy makers warn. That would make it harder to deliver on their new strategy of running inflation above their 2% target for a time in order to achieve that goal over the longer run.“We are probably more likely to be successful with the new monetary policy regime than if we didn’t have it,” Boston Fed President Eric Rosengren said in a Bloomberg News interview this week. But based on the experience of the last decade “you have to take seriously the idea that it is not going to be that easy to get 2% inflation.”Investors are likely to hear more on the topic from Fed Chair Jerome Powell when he speaks at a event held by the Economic Club of Washington on Wednesday.Policy makers at the central bank have been pressed in recent weeks about whether an expected spike in prices -- as the U.S. rebounds from pandemic shutdowns -- will be a temporary blip or something more permanent and dangerous to the economy after a wave of unprecedented monetary and fiscal stimulus over the past year.For years, major economies including the U.S., Japan and the euro zone have struggled to raise inflation to 2% despite aggressive monetary policy actions. Aging populations, the impact of new technology and the disinflationary force of globalization are not things central banks can wish away, while rates stuck at zero -- or below -- telegraph the limits of their power.Inflation pessimism shows up in forecasts released by Fed officials’ at their March meeting as well. Even after taking account of the passage last month of President Joe Biden’s additional $1.9 trillion stimulus package in their forecasts, more than half of the 18 Fed officials estimated inflation would be around 2% or slightly below next year. A majority also forecast prices in a range of 1.9% to 2.2% for 2023.“Several participants commented that the factors that had contributed to low inflation during the previous expansion could again exert more downward pressure on inflation than expected,” minutes of the gathering showed said.March SpikeOn the other hand, a sharp jump in consumer prices last month is a reminder that the risks are two-sided. Both goods and services prices rose last month with the consumer price index rising 0.6% after a 0.4% gain in February as the end of pandemic lockdowns drove up the cost of gasoline, car rentals and hotel rooms, according to data released Tuesday.Rosengren said the Fed has never tried to shift to a new policy regime while exiting a pandemic amid aggressive fiscal stimulus. “We have to be pretty humble about how confident we are about what the inflation outcomes are going to be,” he said.Some indicators of longer-run inflation are starting to move higher, a sign that the Fed is at least getting the public’s outlook pointing in the right direction. The rate on the five-year, five-year forward swap contract for consumer-price inflation is hovering around 2.4%.That is up from a low last year of just under 1% during the peak pandemic lock down period. When adjusting for measurement differences between CPI and the Fed’s preferred measure -- the personal consumption expenditures price index -- it puts longer-run inflation pricing in at just a touch over the central bank’s 2% target.However, some market watchers -- like Fed policy makers -- see an enduring rise in inflation as a challenge.Interest-rate derivative markets don’t foresee the Fed lifting its policy rate beyond about 2% during the upcoming tightening cycle. That’s below the 2.5% Fed officials forecast last month for their long-run policy rate. This backdrop signals that traders don’t see much risk of inflation unmooring or growth getting too robust before the next downturn.“We are looking for a core CPI running closer to 1.9% or so,” after temporary base effects filter through the data, said Phoebe White, interest-rate strategist at JPMorgan Chase & Co. “That’s still pretty soft and we think the underlying trend in inflation is going to be pretty gradual to build as we look into 2022.”There are a range of forces that are likely to keep inflation low from the Fed’s perspective, including the millions of still-unemployed Americans. Slow changes in pandemic behavior -- even as vaccines roll out -- weak wage-bargaining power and an aging workforce could also keep overall demand moderate and prices muted.“We are of the view that we are going to continue to be in a lower inflationary environment both in the U.S. and globally,” said Steven Oh, head of fixed income at PineBridge Investments. “We are not necessarily going to be successful in reaching inflation targets on a sustainable basis.”The Fed also has limited tools. In its recent statement, the Fed pledged to keep rates at zero until “inflation has risen to 2% and is on track to moderately exceed 2% for some time.” But a pledge to do nothing also raises questions about the potency of policy. The U.S. central bank has a legacy of missing its 2% inflation target consistently since it was installed in 2012.“Really it’s about changing peoples’ mindsets and experience for the last ten years,” said Tiffany Wilding, economist at Newport Beach, California-based Pacific Investment Management Co.“You are going to need several periods, maybe several years, of inflation that is running above the Fed’s 2% target to really anchor those expectations, because they have moved down.”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.
(Bloomberg) -- A quarter that began with retail investors declaring the end of the status quo on Wall Street just ended with big banks tallying surprisingly massive hauls.Goldman Sachs Group Inc. and JPMorgan Chase & Co. -- two of the most gilded names in finance -- kicked off bank earnings season with revenue windfalls from trading and dealmaking, defying warnings from within the industry that good times couldn’t last. The boon was thanks in part to the burgeoning optimism of little investors who tried to stage a trading revolution in January.Goldman Sachs earned more from trading in the first three months of the year than it had in any quarter in the past decade, while JPMorgan saw such revenue climb 25%. Stock underwriters at both firms posted the most revenue ever after helping a flood of blank-check companies -- often known by their acronym SPAC -- tap investors to build war chests for future takeovers.“Wow,” Susan Roth Katzke, an analyst at Credit Suisse Group AG, said in a note to clients about earnings at Goldman Sachs, which leans more heavily on Wall Street operations than rivals. “Impressive all around.”Goldman Sachs’s stock jumped 4.7% as of 11:30 a.m. in New York. JPMorgan’s slipped 0.3%, undermined by concern over weak demand for loans.Strong TradingFor months, executives and analysts have been cautioning that last year’s pandemic-fueled market turmoil and demand for cash that propelled trading and dealmaking were easing, and that earnings in 2021 would be characterized by tough comparisons to those year-earlier periods.Instead, traders seem to have had a Goldilocks moment as the year began.In January, retail investors organized on forums such as Reddit drove up GameStop Corp. and other so-called meme stocks that had been beaten down by mainstream finance, making day trading an international sport. Volumes stayed elevated across markets even as volatility began receding by the end of the quarter, according to Goldman’s earnings presentation.In all, Goldman’s traders boosted revenue 47% to $7.58 billion -- more than $2 billion higher than what analysts had projected. Goldman’s dealmakers were busy too, more than doubling investment-banking fees, excluding corporate lending.At JPMorgan, the firm’s stock-trading revenue jumped 47% to $3.29 billion, topping even the highest analyst estimate gathered by Bloomberg. Investment-banking fees soared 57% to $2.99 billion.Still, JPMorgan and Goldman’s results might not translate to jubilee across Wall Street. Both firms warned that they saw lower revenues from their businesses of trading currencies -- an area where Citigroup Inc. dominates. Citigroup and Bank of America Corp. are expected to post quarterly results on Thursday. Morgan Stanley reports Friday.For those minting profits, the question again is whether that will last. Goldman Sachs Chief Executive Officer David Solomon wasn’t making promises.“The first quarter was an extraordinary quarter,” he told analysts on a call. “I don’t think the expectation should be that activity will continue at that pace through the second quarter, the third quarter, the fourth quarter. But I will say activity levels continue to be elevated.”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.
Wall Street indexes closed mixed on Wednesday, with the Nasdaq Composite and S&P 500 falling despite another record intraday high for the latter and big banks' stellar results on the first day of earnings season. Shares of Goldman Sachs Group Inc and Wells Fargo & Co rose 2.3% and 5.5% respectively on bumper first-quarter profits. Goldman capitalized on record levels of global dealmaking activity, and Wells reduced bad loan provisions and got a grip on costs tied to its sales practices scandal.
(Bloomberg) -- Investors in GameStop Corp.’s junk-rated bonds are finally cashing in on the video-game retailer’s wild ride in the stock market.The company’s plan to go virtually debt free drove its 10% notes due in 2023 to an all-time high on Wednesday. The Grapevine, Texas-based firm will have to pay the so-called make-whole premium to retire the debt early, which is meant to compensate investors for any missed future interest payments.The notes were up 3.4 cents to 108.5 cents on the dollar as of 12:18 p.m. in New York and were the biggest gainer in the U.S. high-yield bond market, according to Trace data. Meanwhile, the shares rallied as much as 23%, snapping a seven-day losing streak.The decision to repay debt caps months of speculation among investors on whether GameStop would be able to capitalize on a stock rally fueled by an army of day traders who share tips on Reddit. The company announced earlier this month plans to sell as much as $1 billion worth of additional shares to accelerate its transformation.GameStop said it will use cash on hand to redeem the 2023 bonds, on which it has $216.4 million outstanding. Last month, the company announced it had also redeemed the remaining $73.2 million that was outstanding on its 2021 notes.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.
(Bloomberg) -- The European Union set out its blueprint to raise nearly $1 trillion of debt over five years as it seeks to fund its recovery from the coronavirus pandemic.The bloc is aiming to issue the first debt under its NextGenerationEU stimulus as early as July and will use a “state of the art” platform to begin selling bonds and bills via a network of primary bank dealers by September, according to the bloc’s executive branch. Almost a third of the roughly 800 billion euros ($957 billion) will be in green bonds, using a framework of rules to be published in early summer, with issuance as early as the fall.“The Commission will need to execute financing operations up to EUR 150-200 billion per year over the period to end 2026,” the EU executive said Wednesday. “By June 2021, the Commission will be ready to begin mobilizing the funds.”It highlights the ambition of the EU’s first meaningful entry into bond markets, which will see the total of outstanding bonds closing in on that of Spain’s this decade. It also lays the foundation to challenge U.S. Treasuries in coming years as a haven asset, providing a boost to integration in the region and for its common currency.A One-Day Rival to Treasuries Is Born in Europe’s Pandemic BondsStill, EU member states still have to ratify the recovery proposals and a number of hurdles have arisen that could delay issuance. In Germany, there is a challenge to the package going through the courts, while in Poland a junior coalition party has also committed to opposing it.“We have no time to lose,” said Johannes Hahn, the EU’s budget commissioner, during a press briefing. “I appeal to all member states to speed up the process.”Bonds will be issued and regularly sold across a range of maturities from between three and 30 years, while there will also be short-dated bills, according to the Commission. It highlighted the latter as a quick way to raise money, at least in the early phase of the program. The program is 56 billion euros more than initial plans outlined last year that were predicated on 2018 prices.Hahn said that the Commission would need around 15 billion euros per year in extra revenue in order to service interest on the debt.Investors are likely to be keen. The bloc began selling social bonds tied to the funding of a jobs program last year, and those sales have broken global demand records. The EU will begin to issue debt via auction for the first time, as well as syndications via banks. The new platform will be provided by a national central bank that is already used by one of the “large sovereign issuers,” according to the document.The NGEU package includes grants and loans to member states. The loans will have 30-year maturities, with a grace period of 10 years as nations emerge from the crisis.A Rival to Treasuries? EU Bond Binge Raises Prospect: QuickTake“It’s no exaggeration to say our NGEU program will be a game changer on the capital markets,” said Hahn.(Updates with details throughout, Commissioner Hahn comments in sixth 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.
Fed Chairman Jerome Powell said that he has not yet met with President Joe Biden, illustrating the administration’s caution in approaching matters at the independent central bank.
(Bloomberg) -- Indian dollar bonds are starting to sputter amid fallout from a recent record surge in local Covid-19 cases, dragging down what had been one of the strongest rallies in Asia this year.The notes have lost 0.3% this month, worse than a 0.2% decline for a broader Asian dollar bond gauge, according to Bloomberg Barclays indexes. That’s paring an earlier outperformance sparked by a strong economic rebound that pushed gains on the Indian debt securities to as high as about 1.3% in 2021 at one pointAlso read: Rupee Tumbles With Stocks as Virus Cases in India Hit New RecordGoldman Sachs shifted to neutral on Indian investment-grade and high-yield dollar credits this month, citing its expectation of limited room for further outperformance amid the surging Covid-19 cases, analysts Kenneth Ho and Chakki Ting wrote in a noteThe global bank lowered its forecast for India’s real GDP growth for the year that began on April 1 to 11.7% from 12.3% earlierPerformance of corporate dollar bonds from India will be driven by perceptions of the country’s ability to get control of the outbreak, said Todd Schubert, head of fixed-income research at Bank of Singapore. Investment opportunities may arise in sectors less affected by the infection surge, such as renewable power credits, if there is a broader selloff, he saidSome bonds in that sector have dropped recently too. The yield on India Green Energy’s dollar note due in 2024 has climbed to 4.3% from 3.4% in late February, while Continuum Energy’s 2027 bond yield rose to 4.3% from 3.9% in the same periodIndian banks’ and shadow lenders’ asset quality might come under pressure again as a second wave of infections threatens a fragile economic recovery, according to Fitch Ratings. Financiers are major bond issuers from India.The rapid increase in Covid cases is also credit negative for Indian airports due to the adverse impact on passenger and aircraft traffic, according to Moody’s Investors ServicePrimary Market - Worst Start Since 2008Companies are off to their slowest start in a financial year for rupee bond issuance in 13 years with the amount plunging to 24 billion rupees ($319 million) since April 1, Bloomberg-compiled data showThe slump comes after new rules from markets regulator Securities & Exchange Board of India came into effect April 1. The regulations require borrowers to obtain due diligence certificates from debenture trustees before listing their securitiesSecondary Market - Long-Tenor Yields DropYields on top-rated rupee corporate notes maturing in 10 years are falling for a fifth straight week, the longest such streak in over a year, after the Reserve Bank of India outlined more measures last week to support the economyBy contrast, yields on shorter-term corporate debt have increased on expectations of higher inflation and growthThe central bank took a step last week toward formalizing quantitative easing, pledging to buy up to 1 trillion rupees of government bonds this quarter, to keep benchmark borrowing costs lowIndian government and corporate bond markets were shut April 13 and April 14 for local holidaysBest and Worst Performing Corporate Dollar Bonds Year-to-DateFor 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.
(Bloomberg) -- GameStop Corp. climbed Wednesday after it took a step to retire nearly all its existing debt as part of its transformation from a brick-and-mortar retailer into an e-commerce marketplace.The stock rallied 18% to $166.53, snapping a seven-day slide, for its biggest jump in 2 1/2 weeks. The video-game retailer said late on Tuesday it’s redeeming $216.4 million of senior notes, following a move to retire $73.2 million in debt last month.More than 21 million shares changed hands Wednesday, double what had been seen over the past two weeks. While trading volume has slowed from the eye-popping activity over recent weeks, Gamestop shares are still up nearly 800% this year, bringing the company’s valuation to almost $12 billion.The video-game retailer is in the midst of a turnaround, spearheaded by activist investor Ryan Cohen, shifting from a brick-and-mortar company and into an e-commerce marketplace able to compete with the likes of Amazon.com Inc..Earlier this month, the company announced plans to offer as much as $1 billion in additional shares. The extra cash cushioning, combined with fewer debt obligations may contribute to more favorable terms for the company in dealings with suppliers and partners.“Debt retirement is what they should have focused on in the first place,” Wedbush analyst Michael Pachter said in an email. “That puts them in a very secure financial position.”Read more: GameStop’s Other Trade Pays Off With Takeout of Junk Bonds (1)Volume Pick-UpBullish options on the video-game retailer were more heavily traded in Wednesday’s session than recent weeks. The increase in small-lot calls could signal a return of the same group of investors who were behind January’s epic short squeeze, according to Susquehanna derivatives strategist Chris Murphy.GameStop’s rally stood out from peers that have captivated retail investors as meme stocks were mixed Wednesday. While movie-theater operator AMC Entertainment Holdings Inc. climbed, cannabis stock Sundial Growers Inc. and Palantir Technologies Inc. dipped.GameStop has been hit by the video-game industry’s shift to online distribution. The company reported disappointing fourth-quarter earnings last month.(Updates share movement and adds details on options trading in seventh 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.
(Bloomberg) -- Brazil’s central bank is closely monitoring if a recent spike in commodity prices will continue to affect core inflation, and particularly expectations for 2022, as it removes monetary stimulus, according to its President Roberto Campos Neto.The bank delivered an outsized rate hike last month and promised another in May as it realized that what it deems as temporary price shocks were having a more lasting impact on inflation, even when more volatile items such as food and energy were excluded.“We understand that this process had some contamination in the core inflation numbers,” Campos Neto, 51, said in a Bloomberg TV interview late on Tuesday. “We keep vigilant on how this process is developing.”Brazil’s central bank is trying to put a lid on accelerating inflation without suffocating the recovery of Latin America’s largest economy. It’s an especially delicate balance to strike as the nation reels from one of the world’s worst Covid death tolls and partial lockdowns. At the same time, investors are fretting over faster spending and populist inclinations of President Jair Bolsonaro.Read More: Probe Into Bolsonaro’s Handling of Pandemic Adds to Market Woes“We need to move rates but still be on stimulative grounds,” Campos Neto said during the interview, without ruling out bigger interest rate hikes. “Nothing is written in stone, we’re going to look and see how this develops.”He added that the central bank is “looking at 2022 more and more” to decide on rates.His ability to balance both challenges could define his career at the helm of the monetary authority. Since taking over the post in 2019, the former Banco Santander SA executive oversaw deep cuts to borrowing costs aimed at propelling Brazil out of a virus-driven downturn.But with annual inflation currently at a four-year high of 6.10%, well above this year’s 3.75% target, concern has shifted to the eroding purchasing power of Brazilians. According to the country’s statistics institute, surging transportation costs are a primary cause for the jump with fuel prices rising over 11% last month alone. For 2022, inflation expectations are slightly increasing above the 3.5% target.In effort ease the inflationary pain, policy makers raised rates by 0.75 percentage point in March -- the most in a decade -- and signaled another hike of the same magnitude is coming in May, taking the Selic rate to 3.5%.Many investors believe more aggressive hikes are needed to get inflation under control. Traders in interest rate futures are betting that policy makers will lift borrowing costs to over 6% by year’s end, while economists surveyed by the bank see borrowing costs at 5.25% in December.Fiscal ConcernBut Campos Neto said the swap market is being affected by doubts over Brazil’s commitment to get public finances in order. “We believe fiscal is imposing a premium on the curve, and this premium contaminates expectation that ends up in inflation,” he said.Similar concerns have weakened the Brazilian real nearly 9% so far this year, but Campos Neto said the central bank will continue to limit its interventions to moments of “market dysfunction,” as policy makers don’t target any specific level for the currency, only for inflation.“The important thing is how the real contaminates the inflation channel through the short-term inflation and through its expectations,” he said. “We’re vigilant on that and we’ll act if needed.”The Brazilian real was little changed early on Wednesday as investors awaited developments about this year’s budget impasse.Under pressure from political allies amid a devastating pandemic, Bolsonaro has broken past commitments to rein in public spending and adopted a more interventionist stance toward state-owned companies. In February, he ousted the head of state oil giant Petrobras for allowing fuel costs to rise according to international market prices.Meanwhile, the government continues to dole out more emergency aid as new and more lethal wave of the virus persists. Brazil broke daily records for Covid deaths twice last week, and hospitals nationwide are at capacity with patients sickened by the disease.BRAZIL INSIGHT: Track the Second Wave - High-Frequency DashboardWhile Campos Neto insisted the central bank has no say in fiscal policy, he made it clear that confidence in Brazil’s public finances will be crucial to the future of interest rates.“We think it is very important to pass on a message of fiscal discipline,” he said.(Updates with Campos Neto’s comments on the currency after 12th 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.
(Bloomberg) -- International Holding Co., which has transformed itself into the United Arab Emirates’ second most-valuable listed company, has become one of the biggest shareholders in Abu Dhabi’s largest property developer.Abu Dhabi-based IHC said on Monday it had bought a 45% stake in Alpha Dhabi Holding, but didn’t provide details of the transaction. With the deal, IHC will become a shareholder in Aldar Properties PJSC as Alpha Dhabi acquired a 12.2% stake in the developer last month.“The acquisition of a substantial stake in Alpha Dhabi Holding will add a significant scale to IHC,” Chief Executive Officer Syed Basar Shueb said in a statement. “The move will increase and diversify our investment vertical, as we continually seek strategic partnerships with local and international players.”IHC had started talks to buy Alpha Dhabi, then known as Trojan Holding, in March. The company has amassed a portfolio spanning real estate to utilities and health care to food services through a flurry of deals and its shares have soared more than 110% this year.Its market capitalization of about $43 billion is the second biggest in the UAE, only behind Emirates Telecommunications Group Co PJSC and higher even than the country’s biggest bank. IHC shares were up 3.4% as of 11 a.m. local time.IHC is ultimately controlled by the Royal Group, a conglomerate that lists Sheikh Tahnoon Bin Zayed Al Nahyan as chairman. Sheikh Tahnoon is the brother of Abu Dhabi’s crown prince, Mohammed bin Zayed al Nahyan, who is considered the emirate’s de facto ruler.About Alpha Dhabi:Established in 2008 with a focus in the real estate and construction sectorEmploys more than 22,000 peoplePortfolio manages entities within the construction, hospitality, industrial and capital verticals(Adds stock performance on Tuesday in 5th 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.
U.S. stock indexes rose on Wednesday after upbeat earnings reports from Goldman Sachs and JPMorgan boosted investor expectations of a strong rebound for corporate America amid swift COVID-19 vaccinations. Goldman Sachs Group Inc rose 3.3% after it reported a massive jump in first-quarter profit, capitalizing on record levels of global dealmaking activity. JPMorgan Chase & Co's shares fell 1.1% even as the largest U.S. bank's earnings jumped almost 400% in the first quarter, as it released more than $5 billion in reserves it had set aside to cover coronavirus-driven loan defaults.
(Bloomberg) -- Middle Eastern logistics firm Tristar Transport has pulled its initial public offering in Dubai, dealing a blow to the city’s attempts to revive a stock market where just one company has listed in three years.Tristar has informed Dubai’s main bourse that the IPO has been withdrawn, Chief Executive Eugene Mayne told Bloomberg in an interview. The deal was likely withdrawn “largely due to a mismatch in valuation expectations and investor education,” he said.Tristar had set the price range for the offering at 2.20 dirhams to 2.70 dirhams per share. The firm was offering up to 24% of its shares in the IPO, valuing it at as much as 3.24 billion dirhams ($882 million), and the sale was scheduled to end on Thursday.“We have strong cash flow and cash balances, we have capital for growth,” Mayne said, adding that the firm is not in a hurry to tap the IPO market again in the short term.Setback for DubaiThe deal’s collapse is another setback for Dubai’s stock exchange after the recent delistings of major companies. Tristar’s IPO would have been only the second listing in three years in the Middle East’s financial hub.The bourse was already under pressure from shrinking volumes, with the total value of shares traded in the Dubai Financial Market PJSC at about $18 billion last year. That put it far behind Saudi Arabia’s exchange, which saw $557 billion worth of shares change hands in 2020, a jump of 137% from the previous year.Tristar’s valuation, on a relative basis, “is on the higher side -- at upper range of the price band -- when comparing with some of the global, regional peers in the logistics, transportation sector,” said Harshjit Oza, head of research at Abu Dhabi-based International Securities.Tristar had initially planned to sell shares in London, but those plans were scuttled after a fraud at London-listed firm NMC Health Plc revealed $6 billion of hidden debt, increasing worries among global investors about governance and transparency issues at Gulf firms.Bank of America Corp. and Citigroup Inc. are the global coordinators for the sale. First Abu Dhabi Bank PJSC, HSBC Bank Middle East Limited, Societe Generale SA and Kuwait Financial Centre KPSC are also involved in the sale. Moelis & Co is the financial adviser for the sale.Tristar operates in 21 countries across three continents, and provides transportation and storage services to customers including Abu Dhabi National Oil Co., Total SA and Dow Inc.(Updates with CEO comments)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 IRS commissioner says the child credit payments will arrive on time after all.
Before sitting back and letting the IRS do the work, experts say some people should at least consider filing an amended return.
Wealthy investor Mike Novogratz speculates that bitcoin could be worth $100,000 by the end of 2021 and sees that value increasing by five-fold by 2024, as the nascent crypto market continues to evolve and grow.
(Bloomberg) -- Britain’s financial markets watchdog is looking to upgrade its relationship with the U.S. and give U.K. firms permanent access to American securities and derivatives markets in the wake of Brexit.The Financial Conduct Authority is working closely with the Commodity Futures Trading Commission about a “permanent footing” for U.K. trading venues to operate in the U.S., Nausicaa Delfas, the FCA’s executive director of international, said at a conference on Tuesday.“If granted, this recognition will provide U.K. firms with the certainty they need to conduct their business in the U.S. with confidence,” Delfas said at the City & Financial Global virtual event.The FCA is also in discussions with the Securities and Exchange Commission over access to the U.S. for swap dealers, and the regulator is supporting the U.K. government’s negotiations with the U.S. on a wider trade agreement. These efforts build on agreements made before Brexit came into effect at the start of the year, which pledged to minimize disruption in transatlantic financial markets.“There is much still to be agreed, but we are supportive of an ambitious outcome on financial services that benefits both U.K. and U.S. industries whilst preserving our regulatory objectives and safeguards,” Delfas said.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.