Minggu, 10 November 2019

Saudi Aramco unveils next stage of blockbuster flotation - BBC News

The world's most profitable company has published more details about its planned stock market flotation.

Oil giant Saudi Aramco's long-awaited prospectus said individual retail investors will have a chance to buy shares as well as big institutions.

But the 600-page prospectus did not say how much of the Saudi firm would be sold, nor the date of the listing.

It did, though, mention possible risks, including the government's control over oil output and terrorist attack.

Crown Prince Mohammed bin Salman is seeking to sell the shares to raise billions of dollars to diversify the Saudi economy away from oil by investing in non-energy industries.

Bankers think the long-awaited flotation will value Aramco at $1.5-2 trillion, making the stock market listing the biggest ever.

The prospectus said up to 0.5% of the company would be set aside for retail savers, but Aramco had not yet decided on the percentage for larger institutional buyers.

After the flotation, Aramco will not list any more shares for six months, the prospectus says. Although one of the attractions for investors is the potential of high dividends, the document said Aramco has the right to change dividend policy without prior notice.

Aramco has hired a host of international banking giants including Citibank, Credit Suisse and HSBC as financial advisers to assess interest in the share sale and set a price. Based on the level of interest - a final value will be put on the shares on 5 December.

The sale of the company, first mooted four years ago, has been overshadowed by delays and criticism of corporate transparency at Saudi Arabia's crown jewel.

It was initially thought about 5% of Aramco would be sold, but the final figure is now expected to be half that.

Amid speculation that some foreign institutional investors are cool on the flotation, the government has reportedly pressed wealthy Saudi business families and institutions to invest, and many nationalists have labelled it a patriotic duty.

Aramco last year posted $111bn in net profit. In the first nine months of this year, its net profit dropped 18% to $68bn.

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https://www.bbc.com/news/business-50365604

2019-11-10 10:40:04Z
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Saudi Aramco will offer less than 1% of its shares to individual investors. It still might be the biggest IPO ever - CNN

Saudi Arabia's state oil company said the offering period will begin on November 17 and close on December 4. It will price its shares on December 5, with trading on the Saudi stock exchange, the Tadawul, expected to start in mid-December, according to its prospectus.
The public offering could be largest in history. Aramco has vast oil reserves and massive daily output. It holds a monopoly in Saudi Arabia, the world's largest exporter of crude. The company posted a $68 billion profit for the first nine months of this year, down 18% on the same period in 2018. Profit for the whole of 2018 was $111 billion.
The prospectus did not say how much of the company will be floated, but it did specify that up to 0.5% of shares will be sold to individual investors. There is one class of ordinary shares and a share entitles its holder to one vote. Each shareholder has the right to attend and vote at the general assemblies.
The company will not be able to list additional shares for six months after trading begins. All necessary regulatory and corporate approvals required for the offering have been secured for the IPO, it said.
Details of the long-awaited IPO come as low oil prices, the climate crisis and geopolitical risk have raised skepticism among international investors.
Crown Prince Mohammad bin Salman has reportedly sought a valuation for Aramco near $2 trillion. But a model run by Palissy Advisors, an investment advisory firm based in London, puts Aramco's value at just $1 trillion.
Aramco may need to heavily rely on rich local families, sympathetic sovereign wealth funds or major customers such as China signing up for shares.
There's also growing expectation that Aramco will need to sweeten its dividend in order to get more global investors in the door. The company has committed to a $75 billion annual dividend through 2024. What investors earn from these payouts could compete with ExxonMobil (XOM) and Royal Dutch Shell (RDSA), depending on Aramco's valuation. But Saudi Arabia may need to put up more to boost interest in its partial privatization.

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https://www.cnn.com/2019/11/09/investing/saudi-aramco-ipo-prospectus/index.html

2019-11-10 07:31:00Z
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Garbage, fake, ‘degenerate’: How Donald Trump describes this venture owned by the world's richest man - Times of India

US President Donald Trump and Amazon CEO Jeff Bezos don’t really see eye to eye on many things. Bezos, who is the richest man in the world, is the owner of many businesses and companies. One ‘high-profile’ venture that Bezos has is The Washington Post and Donald Trump has been extremely vocal in his criticism of the newspaper. In less than 24 hours, Trump unleashed a barrage of tweets where he called The Washington Post — or rather as he likes to call it The “Amazon” Washington Post — fake, garbage and degenerate.
In his first tweet, while criticising the newspaper and its reporters, Trump called it “a garbage newspaper.” In his second tweet, Trump accused Washington Post of doing a “made up” story and called it “degenerate”. In another tweet he called the newspaper “Fake Washington Post.”


As we mentioned, all these tweets happened in the space of less than 24 hours.
In fact, earlier this year, he actually called Jeff Bezos as “Jeff Bozo” in a tweet. In the same tweet, he also said that it would be better if “Amazon Washington Post” was owned by someone else. “So sorry to hear the news about Jeff Bozo being taken down by a competitor whose reporting, I understand, is far more accurate than the reporting in his lobbyist newspaper, the Amazon Washington Post. Hopefully the paper will soon be placed in better & more responsible hands!”
Bezos on his part has always maintained a certain restraint about commenting on Trump, at least in public. Except one time and that too was when Trump wasn’t the US president. Back in December 2015, Trump had criticised Bezos and Washington Post in a tweet. Bezos then – and perhaps one of the very few times – directly responded Trump. “Finally trashed by @realDonaldTrump. Will still reserve him a seat on the Blue Origin rocket. #sendDonaldtospace” In the tweet, Bezos actually said that Trump should be sent to space and that he will save him a seat on one of his rockets.

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https://timesofindia.indiatimes.com/gadgets-news/garbage-fake-degenerate-how-donald-trump-describes-this-venture-owned-by-the-worlds-richest-man/articleshow/71990366.cms

2019-11-10 04:03:46Z
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Sabtu, 09 November 2019

Early Black Friday sale is happening now at Target - CNET

target-black-friday-2019

Target has some solid deals lined up for Black Friday, starting with a 2-day preview sale this weekend.

 Target

We've already sneaked a peek at early Black Friday deals from Amazon, Dell, Costco, Sam's Club and Walmart, so it was only a matter of time before Target released its Black Friday ad. There are some rock-solid deals in there, but the more immediate news is the Black Friday Preview Sale that's running now and will continue through today, Nov. 9. For example, you can snag a SodaStream Fizzi for $49.99, the lowest price of the year.

So, what else is worth your time, both this weekend and at the end of the month? I've dug into the Target Black Friday sale to bring you my top great deals.

Here's the best of what you can get right now:

The hot stuff from Target's real Black Friday sale

These are a few of the best deals we've spotted in Target's Black Friday ad. Be sure to check the ad yourself to determine exactly which days these items will be available, and whether they'll be available online or just in-store.

Yes! The previous-generation iPad 9.7 hung around at this price for a good chunk of 2019 -- until the newer 10.2 model came along at $329. Although the 128GB model has routinely been on sale for $299, this is the first dip we've seen yet for the 32GB version. That's not a ton of storage, but for many users it's enough. Read the iPad 10.2 review.

More to come!

Now playing: Watch this: How to win Black Friday and Cyber Monday in 2019

2:25

CNET's Cheapskate scours the web for great deals on tech products and much more. For the latest deals and updates, follow the Cheapskate on Facebook and Twitter. Questions about the Cheapskate blog? Find the answers on our FAQ page, and find more great buys on the CNET Deals page.

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https://www.cnet.com/news/early-black-friday-sale-is-happening-now-at-target/

2019-11-09 15:36:38Z
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Scandinavian Wine? A Warming Climate Tempts Entrepreneurs - The New York Times

SKAERSOGAARD, Denmark — On a mild autumn morning, Sven Moesgaard climbed a sunbathed hill and inspected an undulating expanse of neatly planted vines. A picking crew was harvesting tons of hardy Solaris grapes that he would soon turn into thousands of bottles of crisp white and sparkling Danish wine.

A decade ago, winemaking was regarded as a losing proposition in these notoriously cool climes. But as global temperatures rise, a fledgling wine industry is growing from once-unlikely fields across Scandinavia, as entrepreneurs seek to turn a warming climate to their advantage.

“We’re looking for the opportunities in climate change,” said Mr. Moesgaard, the founder of Skaersogaard Vin, cradling a cluster of golden grapes. “In the coming decades, we’ll be growing more wine in Scandinavia while countries that have traditionally dominated the industry produce less.”

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Credit...Charlotte de la Fuente for The New York Times

Nordic vintners are betting that they can develop what were once mainly hobbyist ventures into thriving commercial operations. The dream is to transform Scandinavia into an essential global producer of white wines, which are beginning to flourish along Europe’s northern rim.

The growth has been rapid: Denmark now boasts 90 commercial vineyards, up from just two 15 years ago, and around 40 have sprung up in Sweden. Nearly a dozen vineyards are operating as far north as Norway.

But many are in the start-up stage and are tiny compared with established wineries in Europe, which has 10 million acres of vineyards — enough to cover almost all of Denmark. Producers in France, Italy and Spain own three-quarters of that land, dominating the European industry. By contrast, Denmark and Sweden have European Union approval to grow less than 1,000 acres of vineyards, and questions persist about quality and price.

“We’re still a drop in the bucket,” said Hans Münter, the head of the Danish Wine Association. “Right now, we don’t have the volume to evaluate if this is a good business or just a business.”

Yet in 50 years, Scandinavia’s climate is forecast to be more like northern France’s, as regional temperatures climb as much as 6 degrees Celsius. In the last decade alone, warming has produced milder winters, a longer growing season — and a small but rising number of award-winning wines.

“You’re seeing a natural progression of pioneers looking for cool climate limits for viticulture, and we will likely see more development,” said Gregory Jones, a climatologist who is the director of the Evenstad Center for Wine Education in Oregon. “Whether a strong vibrant industry will emerge, time will tell.”

Nordic vintners are emboldened to invest as they watch Southern European wine producers struggle with a more volatile climate. Grapes, including sensitive varieties used for white wine, burned on the vine this summer in parts of France, Spain and Italy as temperatures topped 105 degrees Fahrenheit.

Climatologists say the global wine map could be transformed by 2050. Dominant producing countries in Europe and Latin America, along with parts of California and Australia, may become too hot to grow grapes, while areas not traditionally known for winemaking — including China — take off.

Winemakers in France are experimenting with grapes from warmer countries like Tunisia to see if they can retain the blockbuster tastes and yields that generate billions of euros in worldwide sales. Spanish and Italian winemakers are planting higher on mountainsides or on shaded north-facing slopes to keep wine flavors recognizable.

But half a century from now, those regions may no longer be a safe haven, while the climate for growing in Denmark and neighboring countries may improve. Already, winemakers here are credited with creating white wines with crisp, structured flavors that are fading in southern climes where heat is reducing grape acidity.

“We’re trying to define the Nordic style of wine,” said Tom Christensen, who founded Dyrehoj Vingaard, Denmark’s largest winery, a decade ago with his sister, Betina Newberry. That includes investing in grape varieties with an acidic, fresh quality and an organic production without pesticides and sprays.

“People expect Nordic products to be cleaner,” he said.

The winery, on the lush Rosnaes peninsula, produces 50,000 bottles of premium white and sparkling wines, and he plans to expand. “If I had a Spanish vineyard, I’d hedge my bets by buying land here,” Mr. Christensen said. “In 20 years, you’d have a leading business in Europe.”

The hurdles are steep. Rising temperatures have improved growth conditions but are increasingly volatile, bringing acute heat one year and excess rain the next. That makes for uneven harvests. The amount of wine produced is still small, and most is consumed domestically, leaving little for export. Revenue from wine in Denmark, Norway and Sweden was an estimated €14 million this year, compared with €28 billion in France.

More wine will have to be produced for an industry to be sustainable, said Odd Wollberg, a winemaker in Norway. Mr. Wollberg, a former mechanic, and his wife took over the Lerkekasa Vingard winery, once considered Europe’s northernmost vineyard, in December from owners who planted vines a decade ago. Nearly a dozen other vineyards were established nearby in recent years.

So far, Mr. Wollberg has squeezed just 350 liters of wine from Riesling and other cool-weather grapes, and he is losing money. But volumes could surge with an improving climate, he said.

“If it gets warmer, we can produce more, and more wineries will open when people see that others have succeeded,” he said.

To capture consumers, though, the price must drop. Nordic wines average €30 to €40 ($33 to $44) a bottle because of labor costs that are triple those in France, Italy and Spain. Southern winemakers also get billions in European Union subsidies, which help them improve pricing and dominate the market. Denmark won European Union approval for winemaking only by promising to forgo subsidies.

Some experts say that the quality does not yet justify the cost, and that investments in grapes that will produce superior tastes in the Nordic climate are needed. At Fiskebaren, a bustling seafood restaurant in Copenhagen, only two out of nearly 300 wines offered are Danish.

“They’re improving, but they still have a ways to go,” said Frederik Kordt Lassen, the chief sommelier.

In Sweden, winemakers are looking to build business by refining the wine. “People now are just happy they can produce something drinkable,” said Sveneric Svensson, head of the Swedish Wine Association. Businesses are “focusing on optimizing the quality” by advancing vine management and winemaking techniques, he said.

Nordic vintners point to southern England, where a world-class sparkling wine industry has emerged around a warming climate. Companies including Taittinger of France have invested in land in Britain to hedge against the effect of temperature spikes in Champagne.

Mr. Moesgaard, who produces 20,000 bottles a year — including 6,000 bottles of bubbly — is betting that foreign wine houses will one day do the same in Denmark. His Don’s label, named after the Dons region where his vines are planted, won high ratings from the wine critic Robert Parker and at festivals in France and Germany — proof, he said, that quality is there.

Last year, the European Union approved 1,200 acres near his property to be labeled authentic terroir for producing distinctive wines. He purchased 185 acres of that land, which will allow him to double output, and is hoping that daring wine pioneers will cultivate the rest.

“It’s an investment in the future,” he said, eyeing a tract of rolling green hills quilted with vines.

The hills sloped toward a majestic fjord, where cows grazed on a grassy meadow and fishermen caught trout under gold-leafed birch trees. The land near the fjord was damp and muddy. But on the hills where his vines are planted, the soil was sandy with stones and no clay — good for growing grapes.

“We are going to produce wine where it was not possible before,” Mr. Moesgaard said. “No one can say they are happy about climate change,” he added. “But we should take advantage of the opportunities it brings.”

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https://www.nytimes.com/2019/11/09/business/wine-scandinavia-climate-change.html

2019-11-09 08:00:00Z
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This Red Alert Is Now Flashing Bright on the Bond Trader’s Radar - Bloomberg

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  1. This Red Alert Is Now Flashing Bright on the Bond Trader’s Radar  Bloomberg
  2. This Red Alert Is Now Flashing on the Bond Trader’s Radar Screen  Yahoo Finance
  3. View full coverage on Google News

https://www.bloomberg.com/news/articles/2019-11-09/this-red-alert-is-now-flashing-bright-on-the-bond-trader-s-radar

2019-11-09 05:00:00Z
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Jumat, 08 November 2019

A Recession Warning Reverses, but the Damage May Be Done - The New York Times

The message from Wall Street is clear: The American economy is not in the kind of trouble that investors feared earlier this year.

Stocks are at all-time highs and climbing. Yields on long-term government bonds, which reflect expectations for growth and inflation, are also rising. Corporate bond spreads show that investors are more confident in the prospects for businesses.

Then there’s the yield curve, an indicator from the bond market that just a few months ago set off alarms about the risk of a recession. It has gone back to normal, and that signal has been met with relief in the markets.

But as far as the economy is concerned, it might not matter. Once the yield curve has predicted a recession, one usually follows even if that signal changes later.

To understand why, it’s important to remember what the fuss over the yield curve was about in the first place.

The yield curve measures the difference between interest rates on short-term government bonds and long-term government bonds (like three-month Treasury bills and 10-year Treasury notes).

Usually, long-term interest rates are higher because, like any borrower, the government ought to be paying more to borrow for 10 years than for three months. But every once in a while, things get flipped around in the bond market and short-term interest rates rise above the long term, in a sign that investors expect slower economic growth or interest rate cuts — or both.

When it does, the yield curve becomes what economists call “inverted.” It happened this year, starting in March, and it got attention because an inverted yield curve is considered one of the financial world’s most reliable predictors of a recession.

In fact, each recession of the last 60 years was preceded by a yield curve inversion.

So the return to normal, what’s referred to as a “steep” yield curve, is being taken as a good sign.

“A steep curve is a signal that people think that the future is bright, and that is very important to investors,” said Jonathan Golub, chief United States equity strategist at Credit Suisse Securities. “This was an incredibly important thing for us to see.”

It’s important to note that the mood in financial markets can change overnight, and that all these feel-good signals could evaporate if investors are confronted with evidence that they’re wrong.

The recent optimism overlooks the fact that economists continue to see the global economy, including in the United States, decelerating as trade slows and manufacturing contracts.

But there are some reasons investors are right to relax a little, after months of anticipating the damage of the trade war on the United States economy: The job market is holding up, corporate profit reports have been better than expected, and the hope is that the Federal Reserve’s decision to cut interest rates three times so far this year will help keep things going.

Lately, officials in Beijing and Washington have telegraphed that they’re making progress in de-escalating the trade war. On Thursday, yields on the 10-year Treasury note rose to their highest level since July, and the S&P 500 closed at a new high.

Those who have studied the yield curve and its relationship to the economy stress that, historically speaking, it doesn’t matter if the yield curve returns to normal. The recession predictor is that it inverted at all — though the downturn can take as long as two years to arrive.

“In a way, the damage is done,” said Campbell Harvey, a Duke University finance professor whose research first showed the predictive power of the yield curve in the mid-1980s. “If you look at the track record, if you’ve got an inversion, there is a recession that follows.”

One reason is that the yield curve has a real-world impact on the banking system. Banks borrow money at short-term rates and then lend it out — in a 30-year home mortgage, for example — at long-term rates.

So when short-term rates are higher than long-term rates, bank profits are crushed and they cut back on lending. That’s bad news for the economy.

Then there’s the market’s feedback loop, which can stymie decision-making by executives, discouraging new investments.

“When the yield curve is inverted, investors pull in risk taking,” Mr. Golub of Credit Suisse said.

Mr. Harvey stressed, however, that history didn’t always repeat precisely.

And this time, something is slightly different. Since the yield curve inverted, the Fed’s three rate cuts have largely been seen as effective ways to keep the economic expansion rolling.

The first of those, in July, came just a few months after the yield curve first inverted.

That’s a marked difference from the last time the yield curve inverted, in 2006. Then it was roughly a full year before the Fed began to lower short-term rates. (The last recession began in December 2007.)

“In the face of the inversion, it did nothing,” Mr. Harvey said, referring to the Fed. “This inversion, they actually did cut.”

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https://www.nytimes.com/2019/11/08/business/yield-curve-recession-indicator.html

2019-11-08 14:16:00Z
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