EMEA

Capital Calls: Ye makes a social media frenemy

17 Oct 2022

Concise views on global finance: The singer formerly known as Kanye West has bought social media firm Parler, which is going after the same users as the former U.S. president’s Truth Social. If Elon Musk ends up owning Twitter, both will be losers.

Massive fiscal U-turn leaves UK in political funk

17 Oct 2022

New finance minister Jeremy Hunt soothed investors by reversing most of Prime Minister Liz Truss’s “growth plan” and cutting short her generous energy subsidies. But he still needs extra tax hikes or spending cuts. Persuading parliament to support the switch will be a challenge.

Credit Suisse legal tab is wildcard for investors

17 Oct 2022

The bank settled an old mortgage case without having to set more money aside. But the bill for future litigation, up to $1.6 bln on its own estimates, will erode earnings. The risk for investors in a looming rights issue is that further nasties bog down the bank’s restructuring.

Total’s Russia foot-dragging is investor problem

18 Oct 2022

The French energy giant owns a stake in gas group Novatek, and is in theory entitled to a $430 mln dividend. CEO Patrick Pouyanné won’t say whether he’s selling. He may hope that long-held Kremlin ties can secure a clean exit, but the uncertainty is a shareholder concern.

UK still two U-turns away from financial stability

14 Oct 2022

Prime Minister Liz Truss sacked her finance minister after less than six weeks because his unfunded tax cuts roiled markets. She will now attempt a more fiscally sound approach. But her party may decide it needs another leader, while voters may prefer a change of government.

Capital Calls: Italy’s next finance minister

14 Oct 2022

Concise views on global finance: Rightist leader Giorgia Meloni is likely to pick a pro-European politician as finance chief.

Bank mortgage tweaks presage bigger political hit

14 Oct 2022

Spain’s CaixaBank proposed a rate freeze, while UK lenders favour ad hoc relief for struggling borrowers. As interest costs soar, these won’t be enough to avoid a mess. Since cash-strapped governments can’t help, they may hammer banks with Polish-style blanket payment holidays.

Central banks get sucked into financial black hole

14 Oct 2022

Bank of England Governor Andrew Bailey and his peers are raising interest rates to fight inflation. But indebted households, governments and companies make it hard to break free from ultra-easy money. The turmoil will force central banks to change course, says Edward Chancellor.

Trussonomics lights slow-burning Aussie fuse

14 Oct 2022

The disastrous UK mini-budget has sparked a debate Down Under about income tax cuts due in 2024. Prime Minister Anthony Albanese risks a political backlash if he pulls a U-turn, and the treasury does have some wiggle room. But pressure to change course will be hard to extinguish.

Sovereign debt greens yet net-zero pledges darken

13 Oct 2022

Saudi Arabia’s wealth fund is the latest public body to issue securities to fund renewable assets. Strong buyer demand and the chance to flaunt action on climate change explain the boom. Yet national decarbonisation targets remain weak, and green bonds do little to improve them.

Monte Paschi life raft has yet to reach safe port

13 Oct 2022

Five years after a state bailout, the lender has secured last-minute backing for a new 2.5 bln euro rights issue. Stronger capital and fewer costs will make MPS a more palatable target. But buyers would need hefty profit assumptions to pay anything other than a lowball price.

Capital Calls: TSMC

13 Oct 2022

Concise views on global finance: The $324 bln Taiwan Semiconductor Manufacturing barely addressed questions regarding U.S. technology export controls on China during its earnings call.

Bailey outburst blunts BoE crisis-fighting tools

12 Oct 2022

The Bank of England governor vowed to stop bond-buying designed to help pension funds, despite suggestions he might extend it. In the current turmoil, subtlety and strategic ambiguity are key BoE tools. Andrew Bailey has instead locked himself into a path he may need to reverse.

Philips’ supply shock will haunt earnings season

12 Oct 2022

The medical-kit maker lost more than 7% of its value after saying chip shortages curbed sales. It’s a setback for the ailing group’s turnaround under new CEO Roy Jakobs. For automotive and manufacturing companies, it’s a sign that supply bottlenecks may last longer than hoped.

Capital Calls: Soy sauce activism

12 Oct 2022

Concise views on global finance: Foshan Haitian, China’s largest producer of cooking’s brown gold, loses $8 bln in value after consumers complain about ingredients.

A private lender eats buyout bankers’ lunch

11 Oct 2022

With public debt markets shut, funds that help finance leveraged buyouts and other deals have become the only game in town. In this episode of the Exchange podcast, Blue Owl co-founder Marc Lipschultz explains how private credit has muscled in on investment bankers’ home turf.

Capital Calls: Anti-woke ETF’s progressive cause

11 Oct 2022

Concise views on global finance: The God Bless America fund seeks to be an antidote to BlackRock and other big asset managers that focus on environmental, social and governance principles. Yet one investing principle aligns with more enlightened values.

BoE drawn into risky game of financial whac-a-mole

11 Oct 2022

The Bank of England said it would buy more bonds to avert a fire sale by pension funds. Its plan to end such support on Oct. 14 is hampered by a distressed bond market, and wayward government. Governor Andrew Bailey risks either backtracking again, or letting the economy suffer.

There’s method to Saudi’s $38 bln gaming madness

11 Oct 2022

Riyadh says it will splash out to become “the ultimate global hub” for gaming by 2030. Saudi and the freewheeling sector are peculiar bedfellows. But with a petrodollar windfall and falling valuations, the kingdom has a good opportunity to make its unlikely vision happen.

Financial hubs’ neutrality is all at sea

11 Oct 2022

Switzerland and Singapore are taking the West’s side in the Ukraine war. Now fear is rising that Hong Kong will become a Russian stomping ground after an oligarch’s yacht docked there. That’s overdone, but the impartiality of rich centres is increasingly likely to create waves.