Lyft is back above its IPO price, and a famous short-seller warns not to bet against it - CNBC

One of Wall Street's most prominent short sellers has a word to the wise: Don't bet against Lyft.

Andrew Left of Citron Research -- famous for shorting Tesla and Valeant Pharmaceuticals -- called betting against the ride-hailing company an "amateur trade."

"Shorting disruptive companies that dominate a megatrend simply because they lose money is a sure way to go broke," Left wrote in a note to clients Friday.

Lyft, much like its larger rival Uber, is losing money. Lyft lost $911 million despite $2.1 billion in revenue last year, according to a regulatory filing. During its initial public offering roadshow, the company promised eventual 20 percent EBITDA margins but provided no timeline for that.

The San Francisco-based company made its public debut on the Nasdaq last Thursday. Lyft surged 9 percent in its highly anticipated IPO, but stumbled 12 percent by the second trading day. On Friday, it rallied 5 percent and traded back above its IPO price of $72.

Citron is long on Lyft, citing high growth despite losses.

The company grew its active ridership by more than five times from the first quarter of 2016 to the end of last year, according to a regulatory filing. It also has plenty of room to run based on some projections of its total addressable market.

Left pointed to a Goldman Sachs estimate that the ride hailing industry is expected to grow to $285 billion by 2030. It's also a discount compared to Uber, which plans to go public in the coming months. At a reported $120 billion valuation, Uber is valued six times higher than Lyft, Left said.

"The entire ride share market in the US only accounts for 1% of miles traveled today…. we have only just begun," Left said. "This is not a trendy video game or a GoPro camera…. this is a way of life that is saving people time and ensuring safety. Ridesharing is not a fad… it is a megatrend."

Some hedge funds are less convinced.

According to IHS Markit, short sellers have borrowed6.61 million shares of Lyft, or $455 million worth. It's expensive to bet against Lyft. The cost to borrow the ride-hailing shares rose to more than 100 percent a day, making it the most expensive U.S. company with more than $5 million in balances to bet against, according to IHS Markit.

-- CNBC's Yun Li contributed reporting.

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https://www.cnbc.com/2019/04/05/lyft-above-ipo-price-short-seller-andrew-left-warns-not-to-bet-against.html

2019-04-05 15:52:32Z
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Donald Trump urges US Fed to cut interest rates - BBC News

Donald Trump has stepped up his attacks on the US Federal Reserve by calling for the central bank to cut interest rates.

The US President claimed that the Fed has "really slowed us down" in terms of economic growth, adding that "there's no inflation".

Mr Trump made the comments as data showed a sharp rebound in new jobs growth during March.

US firms added 196,000 jobs last month, compared to 33,000 in February.

Mr Trump said: "I think they should drop rates and get rid of quantitative tightening. You would see a rocket ship."

The Fed has raised interest rates four times since Jerome Powell took over as chairman in February last year.

Mr Powell was appointed by Mr Trump but the president has frequently criticised the Fed chairman for increasing rates.

The Wall Street Journal reported earlier this week that Mr Trump told Mr Powell in a recent phone call: "I guess I'm stuck with you."

The Fed had been forecast to raise interest rates a further two times this year. However, it has since said it is now taking a "patient approach" to interest rates.

Last month, it indicated that it did not expect to raise interest rates for the rest of 2019 amid slower economic growth.

'Big disappointment'

While new jobs figures for March beat forecasts - analysts had been expecting growth of between 170,000 and 180,000 roles - earnings data showed that the annual rate of wage increases slowed to 3.2% in March, down from 3.4% in February.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, said: "Overall, these data won't change anyone's mind about whether the Fed ultimately will have to hike this year.

"The payroll gain is welcome but one month does not prove that the trend remains close to 200,000, and doves will point to the modest average hourly earnings gain as evidence that the Fed's 'patient' stance is justified."

Win Thin, global head of currency strategy at Brown Brothers Harriman, said it was a "mixed report" with highlights including an upwards revision to the 20,000 new jobs initially reported in February.

But he said: "The average hourly earnings was a big disappointment."

The unemployment rate remained at 3.8% for a second month.

The healthcare sector saw jobs rise, but the retail and manufacturing sectors both saw declines.

Some 6,000 jobs were lost in manufacturing, the first decline in the sector since July 2017.

Car companies have been cutting thousands of jobs, including General Motors which is cutting about 14,000 workers.

Mr Trump said earlier this week that he would nominate the former boss of Godfather's Pizza to the Fed's board of governors.

Herman Cain, 73, ran to be the Republican presidential nominee in 2012 and is a former chairman of the Federal Reserve Bank of Kansas City.

Along with Mr Cain, Mr Trump also intends to nominate Stephen Moore, who advised the president during his election campaign, to join the Fed's board of governors.

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2019-04-05 15:22:30Z
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American hiring bounced back in March, but a slowdown still looms - CNN

The US economy added 196,000 jobs in March, up from 33,000 the prior month. Despite a slight upward revision from the original estimate, February hiring remained the weakest since September 2017.

Meanwhile, the unemployment rate remained at 3.8%, a level near historic lows.

While March hiring was robust, it brings the first-quarter average to 180,000 jobs created per month, down from 223,000 per month on average in 2018. Economists have been expecting a slowdown, and so far it looks gradual enough to support the idea that the economy may glide to a lower level of activity in 2019 rather than shudder to a halt.

"Markets are looking at every shadow and around every corner, whether it's an inverted yield curve or bad jobs report," said Sean Snaith, director of the University of Central Florida's Institute for Economic Forecasting. "This should assure people that the boogeyman isn't hiding in the closet."

Another anemic month of job growth may have prompted the Federal Reserve to consider an interest rate cut later this year, after years of trying to raise rates back to a "neutral" level; this report is unlikely to push them in that direction.

Also reassuringly, the unemployment rate for African Americans dropped back to 6.7%, after rising to 7% from its lowest point ever back in May 2018.

The report did have one disappointing number, though: Wages, which economists had expected to grow at 3.4% over the year, and instead came in at 3.2%. Sustained periods of low unemployment are supposed to fuel fatter paychecks as employers struggle to fill positions, but this average hourly earnings number suggests the tight labor market isn't accelerating that effect.

"Overall, nothing here to shift the dial very far in either direction. But the gradual slowdown in trend employment growth is another sign that the economy is weakening," Capital Economics Chief US Economist Paul Ashworth wrote in a note to clients.

Also, manufacturing hiring slowed again after having been on a tear for the last year and a half. The sector lost 6,000 jobs in March, concentrated largely in the auto and auto parts sector — after adding only 1,000 in February, and both hourly and weekly earnings dropped slightly. Global manufacturing weakness and mounting tariffs have started to take a toll on the industry, and the shuttering of a General Motors plant in Lordstown, Ohio certainly didn't help.

Retail, which abruptly stopped growing in January 2017 and then trended sideways, dropped another 12,000 jobs in March.

According to the household survey, which comes from a smaller sample, the unemployment rate only remained steady because the labor force shrank slightly more than the number of jobs. If that trend continues, it may show that those who remain on the sidelines of the labor market have structural barriers to joining it, such as care responsibilities or transportation challenges.

And in yet another sign that hiring is cooling off, the median number of weeks that people remain unemployed, at 9.6 weeks, has been ticking up in recent months, suggesting that people aren't finding jobs as quickly as they used to after a layoff.

A measure that never recovered to its pre-recession high, the share of prime-age people who are working, also moved in the wrong direction in March, declining slightly to 79.8%.

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2019-04-05 15:00:00Z
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Stocks rise after strong jobs report eases fears of an economic slowdown - CNBC

Stocks rose on Friday after a better-than-expected U.S. jobs report assuaged fears that the economy was slowing down, lifting investor sentiment.

The Dow Jones Industrial Average traded 69 points higher, led by Goldman Sachs and Nike. The S&P 500 climbed 0.3% as the energy and consumer discretionary sectors outperformed. The Nasdaq Composite advanced 0.3%.

The U.S. economy added 196,000 jobs in March, according to data released by the Bureau of Labor Statistics. Economists polled by Dow Jones expected a print of 175,000. However, wage growth expanded 3.2%, below an expected gain of 3.4%.

Wall Street was looking forward to this report after the previous jobs data showed growth of just 20,000. That number was revised higher to 33,000 on Friday.

"It gave the market a lot of what it wanted to see," said JJ Kinahan, chief market strategist at TD Ameritrade. "The trend reverted back to where the market wanted to see it."

"The test today is going to be whether we hold the gains or we see a Friday fade," said Kinahan.

Treasury yields whipsawed. The benchmark 10-year yield jumped to nearly 2.55% before sliding back to around 2.5%. The 2-year rate rose to about 2.37% before trading at 2.34%.

Friday's strong jobs report comes after the release of disappointing economic data earlier in the week. Activity in the U.S. services sector fell to its lowest level since August 2017 while payrolls data released on Wednesday was also below expectations.

Still, the major averages were on track for solid weekly gains. The S&P 500 and Dow were both up more than 1.5% through Thursday's close. The Nasdaq had gained more than 2% in that time period.

Stocks got a boost this week as China and the U.S. appeared to make progress in trade negotiations. President Donald Trump said Thursday that swift progress had been made, adding "we'll know over the next four weeks" whether a deal can be reached. Chinese Vice Premier Liu He, meanwhile, said new consensus had been reached by both countries on the text of a trade agreement, according to official state news agency Xinhua.

Those gains come as investors brace themselves for the upcoming earnings season, which is set to start next week with J.P. Morgan Chase and Wells Fargo among the companies set to report.

—CNBC's Ryan Browne contributed to this report.

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2019-04-05 13:34:27Z
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U.S. Adds 196,000 Jobs in March; Unemployment at 3.8% - The New York Times

The Labor Department released its monthly hiring and unemployment figures for March on Friday morning, providing an important snapshot of the American economy.

• 196,000 jobs were added last month, a rebound from the February report. Economic analysts surveyed by FactSet had expected a gain of about 170,000 jobs in March. It was the 102nd straight month of job gains.

• The Labor Department also revised the jobs numbers for January and February. February’s weak report of 20,000 jobs was revised upward to 33,000. January’s number was raised 1,000 jobs, to 312,000.

• The unemployment rate for March was 3.8 percent, the same as in February.

• Average hourly earnings in March were 3.2 percent higher than a year earlier. That compares with a 3.4 percent year-over-year gain in February.

Everyone can relax.

The solid job gains that have come to define the current economic expansion resumed in March. The gain in hiring, though widely forecast, will help clear some of the doubts hanging over the economy. Though the economy is expected to slow this year from the strong pace of 2018, Friday’s report was a welcome sign.

But while the March number was reasonably strong, average monthly job growth appears to be slipping. In the first three months of the year, the economy added 180,000 jobs on average, down from an average of 223,000 for all of 2018.

The Big Picture

The United States economy is still enjoying one of its longest expansions on record. It has produced nearly 21 million jobs since the labor market bottomed out in 2010, and the unemployment rate has plunged from a peak of 10 percent in October 2009.

But in recent months, doubts have grown. The invigorating effects of the tax cuts enacted at the end of 2017 are expected to fade. Large overseas economies have slowed, in part a reaction to continuing trade tensions. And while the stock market has rallied since a rout at the end of last year, other important financial indicators — such as government bond yields — suggest that investors expect growth to moderate.

Even so, economists have seen a healthy labor market in the United States.

“The lesson of this recovery is that the labor market keeps chugging on despite whatever turmoil happens around it,” said Martha Gimbel, research director at the job-search site Indeed.

Most economists shrugged off the anemic job report for February, saying the number could have been affected by cold weather and the partial shutdown of the federal government. In recent years, low monthly jobs numbers have usually been followed by a rebound.

Several economic indicators released since the February report suggested that the economy was still capable of adding 150,000 or more jobs a month. The number of people filing for unemployment benefits for the first time has declined to lows not seen in decades, and recent surveys of the construction and manufacturing industries did not suggest that employers were pulling back.

“There is nothing in the business sentiment surveys that suggests hiring was off in March,” said Ellen Zentner, chief United States economist at Morgan Stanley.

The Wages of Growth

For years, even as the economy added jobs and unemployment kept falling, wage increases were lackluster. But employees now appear to be getting solid raises. The 3.4 percent year-on-year increase in February was more than double the annual inflation rate for the month.

“This means households and workers have pretty strong purchasing power and they can spend more at the mall,” said Beth Ann Bovino, United States chief economist at S&P Global Ratings.

With the jobless rate at a historic low, employers have to offer higher wages and more attractive benefits to lure workers. Julia Pollak, a labor economist at ZipRecruiter, a job-search company, said that was reflected in the job postings on her company’s site. In March, 34 percent of the openings advertised on ZipRecruiter had benefits, up from 19 percent a year earlier.

“And the range of perks is growing,” Ms. Pollak said.

Steady wage growth may be the catalyst that helps keep the economic expansion going: Higher wages encourage more spending, and companies that wish to meet that extra demand have to hire more people.

Ms. Pollak said this could be seen in the leisure and hospitality industries, which benefit when people have more money to spend on eating out and traveling. In the past year, the number of jobs in those two sectors grew at a significantly faster pace than in the job market over all.

“It’s not clear that we’re headed toward an inevitable decline,” she said.

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https://www.nytimes.com/2019/04/05/business/jobs-report-unemployment-march.html

2019-04-05 12:33:45Z
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Japanese court extends new detention for Nissan ex-chair Ghosn, drawing scrutiny of country's legal system - Fox News

Former Nissan Chairman Carlos Ghosn in a car leaves his lawyer's office in Tokyo.  (Takuya Inaba/Kyodo News via AP)

A Japanese court on Friday approved the detention of former Nissan Chairman Carlos Ghosn through April 14 after his latest arrest over financial misconduct allegations, a move that has raised questions among legal experts.

The former star executive was taken into custody Thursday over fresh allegations that $5 million sent by a Nissan Motor Co. subsidiary and meant for an Oman dealership was diverted to a company effectively controlled by Ghosn.

Ghosn spent nearly four months in detention and was just released last month after meeting stringent bail conditions while he awaits trial over earlier allegations that he under-stated his compensation in financial documents, had Nissan shoulder his personal investment losses and made dubious payments to a Saudi businessman.

JAPAN SPACE PROBE DROPS EXPLOSIVE ON ASTEROID TO MAKE CRATER

The Tokyo District Court on Friday approved the initial 10-day detention request from prosecutors, who can seek another 10-day extension before needing to file charges against Ghosn, release him or accuse him of fresh misconduct that needs investigating.

Stringing out a suspect's arrest for the full 20 days and then raising fresh accusations is common in Japan, where it is known as a "rearrest." Critics say it allows suspects to be grilled by the authorities, resulting in some signing confessions to crimes they never committed.

The arrest "has the plain look of an attempt to muzzle his ability to present his case to the public.

— Mark Levin

But it is rare for a suspect to receive bail and then be taken back into custody.

Ghosn, 65, was first arrested Nov. 19 and released March 6 on $8.9 million bail, after two previous rearrests. He says he is innocent of all allegations.

Q&A: WHAT'S IN NAME FOR JAPAN EMPEROR'S NEW ERA? 

Prosecutors argue the latest allegations are different from the previous ones, but his legal team says they are part of the same scenario of wrongdoing.

In demanding the latest detention, prosecutors argued Ghosn may tamper with evidence related to the fresh allegations. Prosecutors had earlier fought against bail for Ghosn, a citizen of France, Brazil and Lebanon, arguing he was a flight risk.

Ghosn's lawyer Junichiro Hironaka pointed out prosecutors have already raided Ghosn's property and taken everything, leaving little to tamper with. He accused prosecutors of trying to silence Ghosn, who had tweeted he was planning a news conference next week to tell "the truth about what was happening."

Stephen Givens, an American who practices law in Japan, said the latest accusations are more serious than the previous charges because they imply Ghosn pocketed the money, while the earlier charges were technical offenses that didn't harm Nissan or lead to personal gain.

Nevertheless, Givens noted there were no grounds for detaining Ghosn again, as he had already satisfied a court that he won't flee or tamper with evidence or witnesses.

JAPAN TO NAME NEW ERA FOR SOON-TO-BE EMPEROR NARUHITO

Mark Levin, professor of law at the University of Hawaii, said he was worried about Japan's international image, noting the nation's appeal with future global business talent may suffer.

The arrest "has the plain look of an attempt to muzzle his ability to present his case to the public," he said.

Ghosn's case and the extended detention without a conviction are drawing scrutiny to Japan's criminal justice system, long criticized as "hostage justice."

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Legal experts say Ghosn's previous release on bail came quickly, and many defendants endure months, in extreme cases more than a year, incarcerated while they await trial.

Ghosn, who had led Nissan for two decades before his downfall, said he wasn't giving up.

"I will not be broken. I am innocent of the groundless charges and accusations against me," he said in a statement Thursday.

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2019-04-05 10:37:13Z
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Not even Samsung\'s Galaxy S10 range can save the company\'s consolidated operating profit nose-diving by over 60% - Notebookcheck.net

Samsung is still the world's largest smartphone manufacturer. (Source: Android Central)

Samsung Electronics has issued earnings guidance for the first quarter of 2019, and it shows that the tech giant’s operating profit has decreased dramatically from the first and last quarters of 2018. Issues such as the fall in memory chip prices and weaker demand for products like displays have affected the South Korean manufacturer’s financial performance.

by Daniel R Deakin, 2019/04/05

Earnings guidance for 1Q 2019 has been posted by Samsung on its newsroom site. The company has forecast a consolidated sales figure of 52 trillion Korean won and a consolidated operating profit of around 6.2 trillion Korean won. These figures equate to about US$45.7 billion and US$5.45 billion, respectively.

These are huge numbers, but for a major player like Samsung, they are deeply problematic. The figures for the first quarter of 2018 were a healthy 60.56 trillion won (sales) and 15.64 trillion won (profit) – US$53.2 billion and US$13.75 billion, respectively. Both sales and operating profit fell for the final quarter of 2018 but still look good on paper: 59.27 trillion won (US$52.1 billion) and 10.80 trillion won (US$9.49 billion).

It’s clear to see from the figures above that Samsung’s consolidated operating profit has dived by over 60% in the space of just a year. A result like that would be unsustainable for many companies, but of course Samsung is likely to weather the storm due to the fluctuating nature of its business and the continuing popularity of its products.

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2019-04-05 09:51:50Z
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