Dell is paying the Securities and Exchange Commission $100m to end an investigation into its accounting practices and also its relationship with semi-conductor maker Intel, Reuters reports. Read more
Microsoft Corp managed a 48 per cent rise in quarterly profits on Thursday, helped by strong sales of Windows 7. As Reuters reports, sales were up 22 per cent to $16bn, reflecting a general recovery in tech spending. Read more
US efforts to pass legislation limiting greenhouse gas emissions may be abandoned by Senate legislators, the WSJ reports. Senate majority leader Harry Reid said he had failed to persuad 60 senators to support even limited proposals restricting emissions from electric-power companies. Read more
Japan’s army of small investors are to be offered the chance to put their money into something fishy after Amundi, the asset manager, decided to launch the world’s first public mutual fund devoted to the seafood business, the FT reports. Amundi, formed by a merger of Crédit Agricole’s and Société Générale’s asset management businesses, decided to create the fund after it noticed a strong correlation between people’s rising incomes in emerging economies and an increase in seafood consumption. Read more
Everbright Bank, the only big Chinese state-owned lender that has not yet gone public, plans to raise as much as Rmb20bn ($3bn) next month in a long-delayed initial public offering in Shanghai, the FT reports. The IPO marks the end of a decade-long reform process during which China’s biggest lenders have been cleaned up, injected with fresh capital and floated on stock exchanges. Read more
General Motors said it had agreed to buy AmeriCredit, a Texas-based vehicle finance company, for $3.5bn in cash. The deal marks the Detroit carmaker’s first significant acquisition since its emergence from bankruptcy protection a year ago under the control of the US government, the FT reports. GM sold a majority stake in its former financing arm, GMAC, four years ago to Cerberus Capital Management. Read more
The global coalition against shark fin soup has a surprise new convert – Citigroup. Just last week, the US bank was trying to profit from the Asian delicacy. It launched a promotion, offering credit-card holders 15 per cent off a shark’s fin and garoupa dinner at a popular Chinese restaurant chains in Hong Kong and the same discount for dining at the Imperial Court Shark’s Fin Restaurant in Singapore.
But, as Beyond Brics at FT.com noted, the idea returned to bite Citigroup… Read more
Taiwan’s banking regulator is considering curbs on private fundraising by local banks and insurers, the FT reports. At a time when western, Japanese and Chinese banks are raising billions of dollars in new capital to meet regulatory demands, any restrictions could test Taiwan’s banks, already squeezed by competition. Read more
Investment powerhouse Blackstone has raised a greater-than-anticipated $13.5bn for its new buy-out fund, the biggest since the financial markets crisis, in a strong quarter in which income rose 13 per cent to $205m. As the FT reports, the group’s portfolio was buoyed largely by improved real estate values, in spite of the fall in the stock market and a chill in the debt capital markets. Blackstone’s fee-earning assets under management rose to $101.4bn from $93.5bn a year ago. Read more
Public spending cuts and tax increases should be imposed immediately across the industrialised world amid mounting evidence of a European recovery, according to Jean-Claude Trichet, president of the European Central Bank. Writing in Friday’s FT, Trichet argues that policymakers who want to prolong stimulus are mistaken and that cutting borrowing would have “very limited” effects on growth. Read more
We’re not quite sure how to take this particular compliment:
FT Alphaville Disproportionally Interesting Compared to General News in Predicting Stock Returns Read more
Analysts are down to their last gasps of stress-test commentary before we finally get the official results on Friday. Credit Suisse had a useful contribution on Thursday, tackling the queasy ‘everyone’s a winner!’ hints that politicians have been dropping.
Basically — we should hope so, given the bailouts already in the system. Read more
Here’s some reality-based European banking stress to consider ahead of Friday’s theoretical test announcements, courtesy of some results from a Spanish lender.
Step forward, Banco Sabadell. Read more
John Kemp, at Reuters, continues his sterling work on how contango in commodity markets is influencing trading strategies — and to what degree ‘cash-for-commodity‘ strategies are now getting overly crowded.
The big new thing he adds are ‘synthetic’ cash-for-commodity deals, in which position holders collect contango yields by establishing negative spread positions (shorting near-dated futures and going long future further forward). Read more
In light of the emergence of yet another ‘platform’-based product on Thursday — Deutsche Bank’s platinum Ucits platform, in connection with Paulson & Co’s retail fund offering — we thought it probably best to explain something to the banking community.
(For it seems they do not know.) Read more
FT Alphaville, and others, watched the Baltic Dry’s recent 60 per cent tumble, which took place over a run of 35 consecutive days, with particular interest.
Some, after all, suggested that it meant the index was no longer a valid economic indicator. Other worried that it was just that. Read more
Some, cool, if frankly brain-melting, stuff from Citigroup chief economist Willem Buiter on the plight of the European Central Bank on Thursday.
Or as we should perhaps call it instead — a ‘quasi-fiscal actor’. Read more
Does anyone remember Goldman Sachs’ 2010 Outlook?
The bank’s year-ahead piece, which carried the title “The Outlook for 2010/11: Exciting, with risks!”, is being given a second life after its December 2009 publication. But not in a good way. Read more
Live markets commentary from FT.com
Are we going Japanese? No doubt fed-up with being asked that question in client meetings, Citigroup strategist Robert Buckland has set out to find the answer.
He has examined the Japanese bear market, which started back in 1990, and come to the conclusion that while there are parallels, equity markets in the developed world aren’t facing the same dire combination of weak economic growth, falling corporate profits and earnings dilution. Read more
Goldman Sachs and Morgan Stanley led $14.2bn worth of US corporate bond sales on Wednesday as yields in company debt hit six-year lows. According to Bloomberg it was was their busiest day in almost four months. The deals included Goldman Sachs raising $3bn in a two-part bond offering, its biggest since January 2009, and Morgan Stanley issuing $3bn of debt after it reported second-quarter earnings that surpassed analyst estimates. Read more
The European Union has appealed a World Trade Organization ruling against EU government aid given to Airbus, a subsidiary of EADS, the Wall Street Journal reports. The move follows the US government’s winning of a case three weeks ago in which it claimed the European Union’s support to Airbus was disadvantaging US rival Boeing in the airline market. The paper says EU officials said at the time they had no intention of suspending the aid and had hinted strongly about an appeal. Read more
Just weeks after signing a deal to have its name emblazoned on the shirts of Tottenham Hotspur, shares in FTSE 100 software company Autonomy have dropped following the publication of half year results, reports FT Alphaville. And there’s plenty for the bears to chew over: earnings are lower than expected in spite of a lower tax rate, costs are rising, cash conversion was just OK, and that’s before R&D capitalisation is considered. Read more
Credit Suisse reported a sharp drop in investment banking revenues on Thursday, as the bank suffered from Europe’s sovereign crisis. The division’s pretax earnings slid 53 per cent to SFr784m, missing the 1.01 billion-franc estimate of analysts surveyed by Bloomberg. Net income at the bank rose 1.4 per cent to SFr1.59bn. Reuters reports the Swiss bank said it had seen tough market conditions in the second quarter and believes risk aversion will run high amongst its customers until at least the third quarter. The bank’s shares fell as much as 3.1 per cent in early European trade. Read more
Ocado (IPO) tombstone – FT Alphaville Read more
Leaks and rumours abound ahead of European stress-test result day, not least because the test results could include more information than earlier thought, says FT Alphaville. EU regulators are now reportedly likely to release the results earlier than planned, seeing them hit during European trading hours. European markets would have been closed if the CEBS had released results according to their original schedule. Read more
From page three of Thursday’s appointments section in the FT: