Kotor Baju

Senin, 12 Agustus 2019

Saudi Aramco's profit; Hong Kong protests; BlackRock's private equity deal - CNN

The rare financial disclosure coincides with renewed interest in a potential initial public offering by Saudi Arabia's state oil producer, and bolsters its status as the world's most profitable company.

Apple (AAPL), for comparison, generated profit of $31.5 billion in the first six months of its financial year.

Aramco has been more public about its finances recently as Saudi officials consider whether to list shares in the company in order to fund projects that could wean the economy off its addiction to oil.

An IPO that was planned for 2018 never materialized. A lack of transparency over the size of the country's energy reserves had caused skepticism about the potential sale and the value of Aramco.

But plans for a public listing as early as next year are now being accelerated following positive investor reaction to a bond sale in April, according to the Wall Street Journal.

2. Hong Kong protests: As protests in Hong Kong escalate, the ramifications for businesses and travelers are growing.

The Hong Kong International Airport Authority has canceled all flights scheduled to depart the major travel hub Monday evening because of a mass demonstration. Flights bound for Hong Kong that have not yet taken off were also canceled.

Shares in Hong Kong's flagship airline, Cathay Pacific (CPCAY), were already down almost 5% on Monday. The company said over the weekend it would cooperate with a directive from China's aviation authority that banned staff from flying to, from and over mainland China if they participate in or support the protests.

An internal memo sent by CEO Rupert Hogg to staff on Monday warned that the carrier has "has a zero tolerance approach to illegal activities."

3. BlackRock deal: BlackRock (BLK), the world's largest asset manager, has cut a flashy deal as part of its push into private equity.

The company said over the weekend that it had made a $875 million investment in Authentic Brands, the company that owns Sports Illustrated, Nine West and Juicy Couture. That makes it the company's largest shareholder.

The investment is the first for BlackRock's new private-equity fund, Long Term Private Capital, which the company said in April was ready to start investing after securing $2.75 billion.

4. Global market overview: US stock futures point lower as investors turn their attention to the protests in Hong Kong.

The Dow is set to open down 100 points, or 0.4%. The S&P 500 and the Nasdaq are set to fall a similar amount.

European markets were largely lower in early trading. Britain's FTSE 100 and France's CAC 40 both shed 0.2%. Germany's DAX rose 0.1%.

Stocks in Asia were mixed. Hong Kong's Hang Seng finished down 0.2%, and the Shanghai Composite rose 1.5%.

The Dow closed down 0.3% on Friday. The S&P 500 shed 0.7%, and the Nasdaq declined 1%. All three recorded weekly losses for the second week in a row.

5. Coming soon: A new Before the Bell, packed with insight from CNN Business reporters and trusted experts. If you're not already getting our emails, click here to sign up for a redesigned newsletter that delivers the news, analysis and market charts you need to start your business day right.

6. Coming this week:
Monday — China vehicle sales; Tencent Music (TME) and Saudi Aramco earnings
Tuesday — Germany inflation rate; US inflation; JD.com (JD) and Tilray (TLRY) earnings
Wednesday — China retail sales; Germany and Europe GDP; UK inflation; Luckin Coffee (LK), Macy's (M) and Canopy Growth (CGC) earnings
Thursday — US retail sales; Alibaba (BABA), JCPenney (JCP), Walmart (WMT) and NVIDIA (NVDA) earnings
Friday — US housing starts and building permits

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https://www.cnn.com/2019/08/12/investing/premarket-stocks-trading/index.html

2019-08-12 11:19:00Z
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Dow Jones Futures Fall On Hong Kong Unrest: Apple Stock, Lockheed, AMD, Amazon, Zscaler Show This Is Key In Stock Market Correction - Investor's Business Daily

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https://www.investors.com/market-trend/stock-market-today/dow-jones-futures-fall-hong-kong-unrest-apple-stock-amd-lockheed-amazon-zscaler-stock-market-correction/

2019-08-12 10:47:45Z
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Saudi Aramco has struck a $15 billion deal with Asia's richest man for a stake in the world's biggest ref.. - INSIDER

Saudi Aramco has agreed to acquire a 20% stake in Reliance Industries' refining and petrochemicals business, which is valued at $75 billion.
The $15 billion deal between the world's largest oil producer and Asia's richest man, Reliance chairman and largest shareholder Mukesh Ambani, gives the Saudi Arabian company a stake in the world's biggest refinery.
Reliance will purchase 500,000 barrels of crude oil a day from Saudi Aramco as part of the deal.
View Markets Insider for more stories.

Saudi Aramco has agreed to acquire a 20% stake in Reliance Industries' refining and petrochemicals business, which is valued at $75 billion.

The $15 billion deal between the world's largest oil producer and Mukesh Ambani — Asia's richest man as well as Reliance's chairman and largest shareholder — gives it a stake in the Jamnagar Refinery in India, which can process an unmatched 1.2 million barrels of crude oil per day.

The Saudi Arabian oil titan has been investing heavily in refineries as it looks to double its daily processing capacity to as much as 10 million barrels of crude oil by 2030, according to Bloomberg. Meanwhile, Reliance has been seeking to sell off large parts of its assets, which include cell-phone towers and gas fields, to lower its debt — estimated at $32 billion by Bloomberg.

Saudi Aramco's profits slumped 12% to just under $47 billion in the first half of this year, according to its earnings release.

"I am truly delighted to welcome Saudi Aramco, one of the largest business enterprises in the world, as a potential investor in our Oil to Chemicals division," Ambani said in a statement. "We have a long-standing crude oil relationship with Saudi Aramco and we would be happy to see this further strengthened with this investment."

Reliance has agreed to purchase 500,000 barrels of crude oil a day from Saudi Aramco as part of the deal, Ambani said.

"Saudi Aramco's interest is a strong endorsement of the quality of our assets and operations as well as of the potential of India," he added.

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https://www.insider.com/saudi-aramco-buys-15-billion-stake-reliance-industries-mukesh-ambani-2019-8

2019-08-12 10:40:24Z
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Cathay Pacific says it could fire staff who support Hong Kong protests - CNN

The city's largest airline outlined its "zero tolerance" approach in a memo sent days after Chinese authorities took steps to prevent Cathay workers who participate in protests from flying to mainland China or passing through the country's airspace. Cathay said that it would comply with that rule.

"It is important to remember that actions and words of our employees made outside of working hours can have a significant effect on the company," CEO Rupert Hogg told employees. The airline shared a copy of the memo with CNN.

"We have a high profile in the community given the nature of our business and inevitably actions of our employees frequently attract attention and would be treated as that representing the company's position," Hogg added.

All flights departing Hong Kong were later canceled Monday because of massive protests at its international airport, according to a statement posted on Cathay's website. Cathay cited a directive from the Hong Kong International Airport Authority.

China's Civil Aviation Administration said Friday that it would ban Cathay employees who support or take part in "illegal demonstrations, protests and violent attacks, as well as those who have had radical behaviors" from working on flights in China's airspace. The agency also said it will require Cathay to submit identification details about all relevant crews for approval prior to takeoff.

These global businesses are feeling the heat from Hong Kong's protests

Hogg had told employees on Saturday that the company is legally required to comply with China's aviation authority. He wrote that workers who partake in such actions will be "immediately suspended" from any flights or "air transportation" activity involving mainland China.

The chief executive also pointed out that China is key to the airline's business. Cathay not only flies in and out of mainland China — it also has a "large number of routes" to Europe and the United States that pass through that airspace.

Cathay Pacific is based in Hong Kong, which though a part of China is governed under a separate legal framework granting the city certain political and legal freedoms not available on the mainland.

There have now been 10 consecutive weekends of protests in the financial hub, where demonstrators are calling for greater democracy, an independent investigation into alleged police brutality and the resignation of the city's leader, Carrie Lam.

Clashes between protestors and police have in some cases involved tear gas and resulted in injuries.

"Our primary focus must remain on delivering a safe, comfortable customer experience for everyone who chooses to fly with us," Hogg wrote in his memo on Saturday. "At the same time, we always try to create a safe, supportive environment for all Cathay Pacific Group employees. Though people may share different views, it is essential that we all respect each other, our customers and members of the public."

The company also said that by Thursday it will provide a report to China's Civil Aviation Administration on actions taken to improve flight safety and security, per the agency's request.

On the same day that Cathay announced it would comply with China's aviation authority, the airline also confirmed that it removed a pilot from duty last month who had been arrested during one of the protests.

"Cathay Pacific wishes to make it clear that we express no view whatsoever on the subject matter of any proceedings to which he may be subject," the company said.

Cathay (CPCAY) flies about 34 million passengers every year and serves nearly 200 cities around the world from its hub at Hong Kong's international airport. But its business has suffered because of the city's political crisis.

The airline was forced to cancel more than 150 flights last week amid a day of mass demonstrations and strikes. And the international airport was the site of a three-day sit in.

The company's stock was down about 4.5% on Monday. It has lost more than 11% this month.

CNN's Laura He and Sandi Sidhu contributed to this report.

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https://www.cnn.com/2019/08/12/business/cathay-pacific-hong-kong-protest/index.html

2019-08-12 10:25:00Z
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Apple supplier AMS makes 38.50 euros/share takeover offer for Germany's Osram - Investing.com

By Kirsti Knolle

VIENNA (Reuters) - Shares in Osram (DE:) soared after Austrian sensor maker AMS (S:) triggered a bidding war for the German lighting group, saying it was ready to trump Bain and Carlyle (O:) with a cash offer valuing the company at 4.3 billion euros ($4.8 billion).

AMS said it could create a global leader in sensors and photonics with the acquisition of Osram, a leader in automotive lighting technology whose share price has been depressed by profit warnings, doubts over its strategy and a weak car market.

The offer, which is subject to Osram's waiving a standstill agreement, would trump Bain Capital and Carlyle's 4 billion-euro bid that has been recommended by Osram's boards but slammed as too low by its biggest shareholder.

AMS is keen to diversify into technologies for self-driving cars as it works to reduce its dependence on Apple (O:), which it supplies with sensors for facial recognition technology, and the smartphone sector more broadly.

"The transaction is strategically compelling as it creates the global leader in sensor solutions and photonics for consumer as well as automotive, industrial and medical applications," said Chief Executive Alexander Everke.

"Together we will command the broadest portfolio of optical sensing and photonics in the industry," he said on a conference call on Monday.

Osram shares were up 10% to 34.77 euros at 0804 GMT, below both AMS's offer of 38.50 euros a share and Bain and Carlyle's offer of 35 euros.

Osram said it was examining AMS's proposal and would comment later.

Shares in Swiss-listed AMS fell 10%, with Vontobel analysts saying the transaction would raise the risk profile of AMS and value creation would be highly dependent on synergies, which AMS expects to exceed 300 million euros a year.

The planned bid includes a 4.2 billion-euro bridge loan facility underwritten by UBS (S:) and HSBC (L:), which AMS plans to refinance by issuing debt and equity, including raising 1.5 billion euros of new equity.

A spokesman for Bain and Carlyle declined to comment.

STANDSTILL AGREEMENT

AMS had previously shown interest in Osram in June, and in order to gain access for due diligence it signed a confidentiality agreement at the time, which includes a 12-month standstill agreement.

However, it backpedaled within days as it did not have sufficient financing at the time.

It provided a finance plan on Sunday and said it would wait until Aug. 15 for Osram to waive the standstill agreement and then make an offer.

Analysts have questioned the logic of AMS's interest in Osram, saying the Austrian firm would have to carve out or sell Osram's non-semiconductor operations for a deal to make sense.

AMS said it sees Osram's digital division - part of Osram's attempt to become a high-tech group that builds chips, provides digital lighting systems and supplies sensors and other components - as non-core, adding that it would seek "the best owner" for the division.

AMS said a focus of the combined group should be on the auto sector. It already develops sensors that can help to map roads and control gear shifters and chassis in autonomous vehicles. After a takeover, AMS aims to increase the automotive business's revenue share to 35-40% from currently 10%.

The Austrian group also wants to phase out the consumer general lighting LED business, which includes Osram's billion-dollar factory in Malaysia. Production should be moved to Germany's Regensburg.

($1 = 0.8953 euros)

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https://www.investing.com/news/stock-market-news/apple-supplier-ams-makes-3850-eurosshare-takeover-offer-for-germanys-osram-1952141

2019-08-12 08:49:00Z
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Minggu, 11 Agustus 2019

Tesla explodes after crash on Russian highway - TechCrunch

A Tesla vehicle involved in a collision burst into flames and exploded on a highway near Moscow last night, local media reported. The occupants were slightly injured, but the car is toast.

The model of the car is not clear from reporting, but seems to be either a Model S or Model 3. It was being driven by a 41-year-old Russian man, who had his children with him. He had reportedly engaged a drive assist feature (though not necessarily Autopilot) and had his hands on the wheel when he crashed into a tow truck in the left lane.

The driver broke his legs and the kids got away with just bruises, Reuters reported, but the car wasn’t so lucky. Some time after the crash the car caught fire, and shortly after that a pair of explosions occurred within its body, as seemingly captured (I was unable to directly confirm this) in the following video posted by someone in traffic going the other direction:

Firefighters soon arrived and put the flames out. The circumstances of this crash are still unclear, and there will no doubt be an investigation, as there are for any serious issues like this. I’ve asked Tesla for more details and will update this post if I hear back.

While cars crash and catch fire on a fairly regular basis, Teslas have a rare but recurring problem of bursting into flame after a crash, or even spontaneously. The unique dangers of battery-based vehicles are of course interesting, but the sensational nature of reports around them can also give a false idea of those dangers. Tesla cars are in crashes about as often as other vehicles, but fires are rare.

Whether Autopilot was involved is also not clear. The drive-assist mode the driver was using may simply have been cruise control or the like, and the driver told papers that he didn’t notice the tow truck. Until more facts are known speculation is fruitless.

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https://techcrunch.com/2019/08/11/tesla-explodes-after-crash-on-russian-highway/

2019-08-11 17:09:23Z
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A U.S.-China Currency War? What You Need To Know - NPR

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A Chinese bank employee counts 100-yuan notes and dollar bills at a counter in Nantong, in China's eastern Jiangsu province, on Tuesday. AFP/Getty Images hide caption

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AFP/Getty Images

Last Monday, China let the yuan drop to its lowest value since 2008. The currency is now trading at just over 7 yuan to the dollar.

Later that day, the U.S. Treasury Department promptly labeled China a "currency manipulator."

The decision is a step toward what could become an unusual kind of currency war, in which the U.S. would intervene to counteract the effects of China's weakened currency, or both countries even take steps to increase the value of the other's currency relative to their own.

Here are four things to know about how China manages its currency and what a currency war could mean for the two countries.

Why did the yuan drop in value in the first place?

China's central bank, the People's Bank of China, signals each morning what its desired foreign exchange rate for the yuan will be, and allows it to rise or fall through the day. For the last 11 years, China has kept its currency below a symbolic 7-to-1 ratio to the dollar — until last week.

It's a big change. Since 2016, China's monetary policy has actually been to prop up the yuan's value.

"Over the past several months, the [market] pressure has been toward a weaker yuan, but China has been resisting [depreciation of the yuan]," says Brad Setser, a senior fellow at the Council on Foreign Relations and a former deputy assistant secretary at the Treasury.

But economic forces are making that much harder. China is experiencing symptoms of a slowing economy as domestic debt and an outdated industrial sector take their toll. Its exports have also taken a hit due to U.S. tariffs imposed over the last year, putting more downward pressure on the yuan. Monday's drop in the yuan's valuation now brings the currency closer to what economists consider its true market value.

"China isn't required to resist market pressure for a weaker currency," Setser says.

In a sense, analysts say, China has given in to monetary pressure largely resulting from U.S. tariffs. A weaker currency has the bonus of making China's goods cheaper for American buyers, which could offset some of the tariffs.

So is China a currency manipulator?

The 2015 Trade Enforcement Act lays out three criteria for what constitutes manipulation:

- an annual $20 billion bilateral surplus with the U.S.

- a large enough overall current account surplus (above 3% of the country's annual GDP).

- "persistent, one-sided intervention" in the foreign-exchange market to depreciate its currency.

China meets only the first of those three criteria, according to the Treasury's most recent report on the topic in May.

China does carefully manage its currency to keep the yuan at a stable and targeted value through a host of measures, chiefly through buying and selling U.S. dollar bonds and controlling the outflow of yuan from its borders. But those activities do not rise to the level of currency manipulation, experts in China and the U.S. argue.

"I personally see this as a U.S. tactic of putting extreme pressure on China," says Wang Huiyao, president of Beijing-based think tank, the Center for China and Globalization, and an adviser to China's Cabinet.

Setser says there was a period when China did unequivocally qualify as a currency manipulator. From 2003 to about 2013, he says China consistently intervened to depreciate the yuan by buying up billions of dollars in foreign currency. When China buys up lots of dollars, it makes the U.S. currency more expensive relative to the yuan, meaning the Chinese currency becomes weaker. Still, the U.S. complained but did not declare China to be a currency manipulator.

"The perception was that China might react negatively and that the more productive path was one of quiet negotiation and quiet dialogue. You can debate whether that was the right choice," says Setser.

What would a currency war look like?

The U.S. could threaten to buy up large amounts of Chinese government bonds, which would push up the yuan's value, even if China wants it to depreciate. But China could also counter by buying up more U.S. Treasury bonds, driving up the dollar.

China has also long been pushing for its currency to overtake the dollar in international influence. "If the U.S. continues to push in [a currency dispute], then China probably will accelerate the globalization of the renminbi as a currency for international trade," says the Cabinet adviser Wang, using an alternative name for the yuan.

What happens next?

The Trump administration could create a legal justification for hiking tariffs on Chinese goods to the U.S. to offset any export advantage gained through a weaker yuan. That would break global trade rules, but the U.S. has already flouted those regulations by levying tariffs on Chinese imports as part of the ongoing trade war.

The U.S. could begin negotiations with China through the International Monetary Fund, but the talks may be seen as symbolic: The U.S. lacks the legal means to retaliate against a country for manipulating its currency.

So far, China has argued that the fluctuation in the yuan exchange rate is due to market forces. Chinese trade experts say further devaluation would be risky for China's own economy, suggesting the country will not push the yuan much lower.

"It's bad for imports, and it's bad for our capital assets," explains He Weiwen, a former commercial attache at Chinese consulates in the U.S. That is because making the yuan weaker means China will have a harder time paying off dollar-denominated debt and buying imports. It would also depreciate the value of Chinese yuan-held assets.

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https://www.npr.org/2019/08/11/749655951/a-u-s-china-currency-war-what-you-need-to-know

2019-08-11 12:00:00Z
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