EMEA

Sluggish BP earnings exacerbate its green dilemma

31 Oct 2023

The $105 bln UK giant missed quarterly net profit forecasts by 20% after weak gas results and a big wind writedown. That casts doubts on its clean energy division’s profitability while adding pressure to up its oil and gas game. Tackling both challenges requires creativity.

Big government will drive the next market cycle

31 Oct 2023

Politicians are at their most interventionist in decades. Though a return to the stagnant, centralised economies of the 1970s is unlikely, subsidies and inflation will influence asset values. Fund managers need to pick investments that may benefit from the state’s visible hand.

Capital Calls: Pfizer pessimism

31 Oct 2023

Concise views on global finance: A glut of vaccines has gutted Pfizer’s valuation, leaving it lower than it was before the pandemic. That’s an over-reaction, even if its Covid-19 therapies prove worthless.

Biden AI plan is one step in avoiding crypto trap

30 Oct 2023

The president’s new executive order aims to set regulatory guardrails for artificial intelligence. It still leaves a big hole for Congress to fill. Failing to set coherent rules risks the kind of piecemeal enforcement that hobbled crypto, but for a technology with higher stakes.

HSBC’s profit resilience may face sterner tests

30 Oct 2023

Europe’s largest bank doubled third-quarter earnings and is buying back $3 bln of stock, despite a hit from Chinese real estate. Yet the benefit of higher rates is wearing off while costs are stubbornly rising. CEO Noel Quinn’s targets leave room for bigger setbacks.

Capital Calls: McDonald’s resilience

30 Oct 2023

Concise views on global finance: The Golden Arches’ global same-store sales rose 9% thanks to both selective menu-price increases and smaller meals in different markets. It demonstrates the company’s ability to keep pace with disparate economies’ stretched consumers.

Israel war tests US appeal to global swing states

30 Oct 2023

US power in part hangs on its claim to pursue a principles-based foreign policy. The Gaza conflict has led to accusations of double standards. If these stick, the United States’ attempts to woo developing countries as part of its new Cold War with China could suffer.

Capital Calls: Big Oil, Intel

27 Oct 2023

Concise views on global finance: Exxon returned $8 bln of cash to investors in the quarter, while Chevron returned some $6 bln. With investment rising and M&A on the table, investors are competing with new priorities; Intel shares jumped 10% after slowing declines in revenue.

UK banking pain is a warning for European lenders

27 Oct 2023

NatWest fell 10% after slashing its 2023 revenue target on Friday. Brits are looking for better savings rates, meaning banks have to pay up or lose customers. Continental peers, like UniCredit and CaixaBank, may be at risk of suffering the same plight as their British rivals.

Qatar can weather latest foreign stress test

27 Oct 2023

The Gulf emirate is under scrutiny for its links to Hamas, six years after a blockade by neighbours. One risk is that its $450 bln sovereign wealth fund gets a frostier reception. But Doha’s giant gas reserves and its role as mediator and US ally should protect its clout.

The case for a career in bond investing

27 Oct 2023

Rising rates and volatile markets have hammered the conventional case for buying fixed income securities. But higher yields, pockets of value in credit and a possible weakening of the strong US dollar mean there are still opportunities in bonds for budding portfolio managers.

Germany faces tricky call on Siemens Energy aid

26 Oct 2023

The $6 bln firm’s shares slumped 34% on fears banks might not issue guarantees for its projects. Berlin would usually expect investors like parent Siemens, which has a 25% stake, to step in. Yet as Europe ramps up clean energy, there’s a case for state help for existing players.

Capital Calls: Ford, Amazon

26 Oct 2023

Concise views on global finance: The loss per car at the $45 bln automaker’s electric-vehicle unit has jumped 51% in a year. So-so earnings at the $1.2 trln e-commerce giant’s cloud division beat the even lower bar set by rival Alphabet.

Europe’s oil majors are stuck as M&A party-poopers

26 Oct 2023

Exxon Mobil and Chevron’s respective decisions to double down on oil have put European peers Shell, BP and Total on the spot. Yet their lower valuations complicate share deals. The most obvious big targets for lower-carbon M&A are invitingly cheap, but look hard to get at.

StanChart hopes crash into harsh market realities

26 Oct 2023

Shares in the lender run by Bill Winters tanked by up to 17% after surprise hits to its China bank and real estate holdings. These may be one-offs. But the reaction is a reminder that StanChart’s current mediocre goals, after years of subpar results, offer little room for error.

ECB’s rosy outlook is a recipe for economic pain

26 Oct 2023

Frankfurt policymakers think the euro zone will grow by 0.7% in 2023 and want to keep rates high to fight inflation. Yet most data point to stagnation or recession. A gloomier perspective would enable the European Central Bank to ease policy and help the bloc’s economy.

Music fund’s flat deal calls for major key change

25 Oct 2023

Shareholders are pushing Hipgnosis, run by industry veteran Merck Mercuriadis, to overhaul its board and cancel a $440 mln asset sale involving Blackstone. Poor governance and a discount value add weight to their case. A new management team could do better by selling the company.

Worldline crash is pivotal moment for payments

25 Oct 2023

The $7 bln French group’s shares fell 60% after it said sales would be hit by a call to ditch riskier merchants. Investors expect payment providers to be on top of flaky transactions. The fact that a leading player has had to rethink will scare them, and alert regulators.

Europe’s investment-bank push is far from a shove

25 Oct 2023

Deutsche Bank has bought a $500 mln UK boutique, BNP is bulking up in markets and Santander has hired 50 Credit Suisse bankers. Yet no one is trying to go back to 2010, when the region had 48% of the debt-trading business. That’s good for US rivals, and the Europeans’ investors.

Russian war economy is overheating on a powder keg

25 Oct 2023

Soaring military spending is Moscow’s main growth engine, leading to tight labour markets and 6% inflation. The government is strengthening its grip on a country gradually closing to the world and financially beholden to China. If peace returns, a collapse is a real risk.