Latest News
See the latest news and get GPT analysis of articles
Reality check: can Treasury afford pledge to raise tax-free pension allowance? 2024-05-28 15:55:00+00:00 - The Conservatives have announced plans to boost pensioners’ income with a “triple lock plus”. It is a pitch to a group who, according to many polls, are the most likely to support the Tories, and is seen as a measure designed to shore up the party’s core vote. What is the pledge? From April 2025, a Conservative government would raise the tax-free pension allowance in line with the triple lock. That would mean the personal allowance for pensioners would increase by 2.5%, average earnings growth or inflation – whichever is the highest. According to the Office for Budget Responsibility, by 2027 the state pension is expected to be higher than the tax-free personal allowance. The Conservatives say the “triple lock plus” would mean the state pension would always be below the tax-free threshold, preventing millions more pensioners being dragged into income tax. They say it will amount to a tax cut of about £100 a year for 8 million pensioners next year – rising to £275 a year by the end of the parliament. How much would it cost? The Conservatives claim the policy would cost an estimated £2.4bn a year by the end of the parliament, and is in addition to the £2.5bn bill for the prime minister’s plan to recruit 18-year-olds to take part in a national service scheme. However, the Institute for Fiscal Studies (IFS) – the tax and spending thinktank – said forecasts of what it might cost could be blown off course if there was a repeat of the kind of economic shocks we have had over the last four years. It would only take inflation to take off again and the bill could rocket, it said. How will it be paid for? Rishi Sunak said a previously announced plan to save £6bn a year from a clampdown on tax avoidance and evasion would be used to fund the tax break for pensioners. Labour has a similar scheme to tackle errant taxpayers, though it is more circumspect about the money it will raise. The Conservatives said its national service plan would be partly paid for by cracking down on tax avoidance and evasion, but also by £1.5bn being diverted from the UK Shared Prosperity Fund. Is it affordable? Carl Emmerson, deputy director at the IFS, said there were doubts about any government’s ability to achieve savings from chasing tax evaders (evasion is criminal activity) and avoiders. The Office for Budget Responsibility has also said there is not enough evidence to show the Treasury can raise the funds from avoidance and evasion. More broadly, Emmerson said: “The bigger picture is that the public finances are not in a good state and the next government will need to show how it is going to fund public services.” Promises of tax cuts make that harder, he said. Who aligned tax thresholds in the first place? In 2010, the coalition government embarked on a plan to end a long period when pensioners enjoyed a higher income tax allowance than working people. Back in 2010–11, the personal allowance was £6,475 for people aged under 65, compared with £9,490 for those aged 65 to 75 (and £9,640 for people 75+). Ministers raised the working age threshold until it was the same as the pensioner allowance. In recent years the threshold has been the same for everyone and frozen, as part of a policy to raise taxes.
Boohoo backtracks on plan to pay bosses £1m bonuses 2024-05-28 15:53:00+00:00 - The online fashion specialist Boohoo has backtracked on a plan to pay three top executives £1m each in bonuses after reporting widening losses and falling into debt. The move comes after shareholders complained that bonuses were going to be awarded to directors despite the chief executive, John Lyttle, and Boohoo’s co-founders, Mahmud Kamani and Carol Kane, missing bonus targets on sales, profits and cashflow as well as environmental and IT aims. Investors had been due to vote on 20 June on whether to approve the remuneration plan, which was announced last week in Boohoo’s annual report. It showed the retail group, which owns Debenhams, Warehouse, Dorothy Perkins and Pretty Little Thing, built up net debts of £95m in the year to the end of February – down from almost £6m of net cash a year before – after losses widened 76% to £160m and sales fell to £1.8bn. The difficult year meant the three bosses were set to receive no bonus but the group’s remuneration committee said in the annual report that it had awarded them a one-off bonus of £1m each, 30% of which would have been in cash and the rest in shares. The committee said it wanted to make the award because a zero bonus “is not an accurate reflection of the excellent work carried out during the year to set the business up for future success” and that it would not “ensure that the management team is motivated and retained throughout the next financial year which will be pivotal for the group’s long-term success”. However, in a short statement released on Tuesday, Boohoo revealed it was backtracking and had “decided not to implement the incentive plan at this time” after it had “engaged with certain shareholders”. That came after a report in the Times that one major shareholder was “furious” about the change to the bonus scheme while another said it was “outrageous” that proposals for the one-off bonus been released in the annual report without consulting investors first. The loss of the awards means Kamani’s pay for the year will be just under £503,000, Kane’s just under £524,000 and Lyttle’s £713,175. Both Kamani and Lyttle earned more than £1m in the year before and Kane earned £986,984. The latest upset comes after a string of wrangles between Boohoo’s founders and shareholders over bonus payouts. Last year, shareholders narrowly approved a new “growth share plan” under which Lyttle could receive a maximum of £50m in Boohoo shares, part of a total £175m payout to executives, if the company’s share price reaches 395p – and remains there within a 90-day average window within five years. Boohoo executives would start to receive initial payouts once the share price returned to 95p, close to the level it was at in February 2022. It currently stands at less than 35p. Kane, who co-founded Boohoo in 2006 along with the executive chairman Kamani, would also receive a bonus under the scheme.
T-Mobile buys most of U.S. Cellular in $4.4 billion deal 2024-05-28 15:49:00+00:00 - T-Mobile, the nation's second-biggest mobile carrier, plans to acquire most of U.S. Cellular in an acquisition worth $4.4 billion, the wireless carriers announced on Tuesday. The deal involves cash and as much as $2 billion in debt, with Bellevue, Washington-based T-Mobile buying 30% of U.S. Cellular's spectrum assets as well as the regional carrier's customer accounts and retail stores. U.S. Cellular customers will be allowed to keep their current plans or switch to a T-Mobile plan, the companies said. The transaction is expected to close in the middle of next year, pending regulatory approvals. Chicago-based U.S. Cellular has more than 4 million wireless subscribers in 21 states. T-Mobile shook up the wireless industry in 2020 with its $26.5 billion takeover of Sprint. Shares of U.S. Cellular leaped nearly 12% ahead of the opening bell, but fell nearly 2% after trading opened, while shares of T-Mobile were treading water and lately ahead 0.9%. AT&T in 2011 scrapped its proposed $39 billion takeover of T-Mobile in the face of stiff opposition from the Obama administration, but T-Mobile's proposed deal for U.S. Cellular assets is unlikely to face the same hurdles, according to telecom analyst Blair Levin of New Street Research. There is a "mild risk" the deal could face opposition from federal regulators, notably the Federal Communications Commission, he told CBS MoneyWatch. FCC opposition led TV station operator Tegna to pull the plug on its $8.6 billion deal with hedge fund Standard General a year ago, noted Levin, who added that he does not think the T-Mobile-U.S. Cellular deal would garner the same political resistance. "The major concerns we have heard go to the approach the leadership at the antitrust authorities and the FCC have taken in analyzing transactions," Levin told investors in a research note. "While these concerns are understandable, we don't think they will lead to any transaction being rejected." T-Mobile in April received U.S. approval to acquire Mint Mobile, the budget wireless provider, in a cash-and-stock deal valued at as much as $1.35 billion in March 2023.
Financial Sector: Potential Trend Change Looms with Double Top 2024-05-28 15:46:00+00:00 - Key Points The financial sector, previously up over 11% YTD, faces a critical juncture with a recent 2% pullback suggesting a potential double top and trend change. XLF is near key support levels, with the 20- and 50-day SMAs converging. A break below $41, despite a near 10% YTD gain, could confirm a trend shift. Key holdings—Berkshire Hathaway, JPMorgan Chase, and Visa—are crucial to watch. Berkshire and JPM are strong YTD, while Visa's recent consolidation hints at a potential downside if support fails. 5 stocks we like better than Visa Previously an outperformer with a year-to-date gain of over 11%, the financial sector now finds itself at a critical juncture after giving back some of its gains. Just six trading days ago, the Financial Select Sector SPDR ETF NYSE: XLF made a new high but has since pulled back over 2%. From a technical analysis perspective, this recent action suggests the makings of a double top. This classic bearish pattern could signal a significant trend change and potential downside for the sector. Currently trading near its uptrend support and at the critical juncture where the 20- and 50-day Simple Moving Averages (SMA) converge, the XLF is poised for a decisive move. If the ETF breaks below the key support zone at $41, it could confirm the trend shift and signal further downside. Despite this precarious position, the sector remains up nearly 10% year-to-date and boasts a remarkable 30% gain over the past year. To better understand the sector's future direction, examining its top holdings and their current standings is crucial. Get Visa alerts: Sign Up Top Holdings in the Financial Sector ETF The financial ETF provides exposure to significant players in the US financials segment, focusing on large banks through a cap-weighted, S&P 500-only portfolio while avoiding small-cap companies. Here’s a closer look at the ETF’s top three holdings: Berkshire Hathaway Inc. Berkshire Hathaway Today BRK.B Berkshire Hathaway $403.90 -3.51 (-0.86%) 52-Week Range $319.00 ▼ $430.00 P/E Ratio 11.92 Price Target $414.00 Add to Watchlist , the ETF’s largest holding with a 12.99% weighting, has demonstrated robust performance, up over 14% year-to-date. The company (BRK.A) recently announced an impressive earnings beat, with quarterly earnings of $7,796.46 per share and revenue of $89.87 billion, reflecting its continued strength. Despite this, BRK.B has struggled to reclaim resistance at $420, consolidating instead above its rising 200-day SMA. In the near term, $400 will act as critical support. A break below this level could signal a potential downside for the stock and, by extension, the sector. JPMorgan Chase & Co. JPMorgan Chase & Co. Today JPM JPMorgan Chase & Co. $199.50 -1.21 (-0.60%) 52-Week Range $134.40 ▼ $205.88 Dividend Yield 2.31% P/E Ratio 12.05 Price Target $194.10 Add to Watchlist , the ETF’s second-largest holding, has also been an impressive mover, with its stock up 18% year-to-date. The company boasts an attractive P/E of 12.12 and a dividend yield of 2.29%, with analysts maintaining a moderate buy rating based on 13 ratings. From a technical analysis standpoint, JPM continues to make higher lows within its uptrend. The stock is well above its uptrend support of $190, and a bearish technical pattern would only take hold if it were to break below this key zone, which seems unlikely in the short term. Visa Inc. Visa Today V Visa $270.98 -3.51 (-1.28%) 52-Week Range $216.14 ▼ $290.96 Dividend Yield 0.77% P/E Ratio 30.28 Price Target $303.76 Add to Watchlist the ETF’s third-largest holding with a 7.59% weighting, has underperformed relative to its peers, with the stock up just 5.4% year-to-date. Visa's P/E is more expensive at 31.17. The company recently reported strong earnings, with $2.51 EPS for the quarter, beating the consensus estimate by $0.08, and quarterly revenue of $8.78 billion, up 9.9% year-over-year. Despite these positive results, Visa recently made a lower high and is consolidating in the mid to low range of its consolidation on a higher timeframe. A break below its most recent higher low near $270 could signal a trend change and potential downside for the stock. The Bottom Line The financial sector stands at a potential inflection point, with the XLF displaying the makings of a double-top formation and trading near critical support levels. The recent pullback and tightening price action suggest a significant move may be imminent. If the ETF breaks below the $41 critical support zone, it could confirm the trend shift and signal further downside. Investors should closely monitor the sector's top holdings—Berkshire Hathaway, JPMorgan Chase, and Visa—as their performance and technical patterns will likely play a pivotal role in determining the sector's overall direction in the coming weeks. Navigating these uncertain waters requires a careful and informed approach, balancing the sector's impressive year-to-date gains against the looming technical risks. Before you consider Visa, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Visa wasn't on the list. While Visa currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Sales in UK shops bounce back as inflation slows 2024-05-28 15:42:00+00:00 - Sales in British shops have bounced back in May, according to retail data that suggests slowing inflation is encouraging customers to buy more. A net balance of +8% of retailers told a Confederation of British Industry (CBI) survey that sales volumes were up this month compared with the same period a year earlier – a sharp improvement on the -44% year-on-year figure for April. The balance is the difference between companies who answered that the number of items was “up” or “down”. May marked the most positive monthly reading for the CBI distributive trades survey since December 2022. Alpesh Paleja, the CBI lead economist, said there were signs of a recovery in retail in the short term. “Falling inflation, and continuing real wage growth will contribute to a healthier consumer outlook, in turn supporting the retail sector further,” he said. The figures are likely to be seized on by Rishi Sunak and the Conservatives, with much of the prime minister’s justification for calling a summer election based around his claim that “the economy is turning a corner”. May’s better data follows poor sales values in April and March that were blamed on bad weather and the ongoing cost of living crisis. The amount of goods bought in April also dropped 2.3% month on month, according to Office for National Statistics data, with furniture, clothing, sports equipment, and games and toys among the big ticket items customers elected to do without. The fall was partly blamed on Easter falling earlier than usual, at the end of March. Shop prices are also growing more slowly, according to the CBI’s measure of selling price inflation. Inflation was at its slowest since August 2020 and below its long-run average, with the expectation of only a slight pickup in June. This matched earlier data from the British Retail Consortium showing that store prices grew at an annual rate of 0.6% in May, down from 0.8% the previous month. This was a huge drop from the high of 9% reached in May 2023 and the slowest price growth since November 2021. The data will be welcomed by the Bank of England as further proof that the economy is cooling as it considers a cut to interest rates in June. skip past newsletter promotion Sign up to Business Today Free daily newsletter Get set for the working day – we'll point you to all the business news and analysis you need every morning Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion However, the long-term picture was less positive. The CBI polled 137 businesses involved in retail, of which 56 were chains, and found that jobs in the sector were shrinking, with employment declining for the seventh consecutive quarter. The number of people employed in retail is also expected to decline, though more slowly, next month. Retailers said they were less likely to invest now than they were in February, demonstrating pessimism about the future state of the economy. “The mixed mood from our survey demonstrates just how nascent the economic recovery is,” Paleja said.
BuzzFeed Clashes With Vivek Ramaswamy 2024-05-28 15:35:20+00:00 - BuzzFeed’s newest activist investor, the former Republican presidential candidate Vivek Ramaswamy, wants the company to consider moves like hiring the former Fox News host Tucker Carlson and the N.B.A. commentator Charles Barkley. Jonah Peretti, BuzzFeed’s founder and chief executive, has already rejected some of Mr. Ramaswamy’s requests out of hand, setting up a clash between the two men. Mr. Ramaswamy, an investor who has amassed an 8.3 percent stake in BuzzFeed, sent a letter to the company’s board of directors Monday criticizing its business practices and journalistic efforts. Though he has been steadily buying up stock for months, his intentions for the company didn’t become clear until this week. Before his brief run for president, Mr. Ramaswamy made a fortune in the pharmaceutical business, selling his company’s stake in promising firms to the Japanese conglomerate Sumitomo.
Trump touts Kim Jong Un as North Korea’s 'absolute leader' 2024-05-28 15:14:23+00:00 - To appreciate the scope of Donald Trump’s vision, and the degree to which it’s reminiscent of authoritarian regimes, it’s important to note the Republican’s praise for foreign dictators. Alas, this isn’t altogether new. Ahead of the 2016 elections, the then-GOP candidate was on record praising Saddam Hussein, Vladimir Putin and even China’s handling of the Tiananmen Square massacre. (Seeing images of brave Chinese democrats standing in defiance in front of tanks, Trump sided with those who ordered the tanks.) Ahead of the 2024 elections, Trump doing it again. As regular readers know, the presumptive Republican nominee continues to make positive comments about the man who earned the “Butcher of Baghdad” label. He offers gushing admiration for Beijing’s “ruthless” control over China’s population. He struggles to contain how impressed he is with his benefactor in Moscow. He celebrates Hungarian Prime Minister Viktor Orbán “because he says, ‘This is the way it’s going to be,’ and that’s the end of it. ... He’s the boss.” At a rally in New York last week, Trump again expressed his admiration for a variety of foreign dictators, including North Korea’s Kim Jong Un. It was against this backdrop that the Republican sat down with podcaster Tim Pool and elaborated on his pal in Pyongyang. “There was certainly hostility when I first started,” the GOP candidate said, “and all of a sudden, it boiled down to something that was very beautiful, the way it happened. And I got along with him very well. ... I got along great with him.” Trump added, in reference to the North Korean dictator, “Very smart guy, very strong guy. He’s the absolute leader of that country.” The rhetoric adds to a lengthy record. In 2018, for example, the then-American president repeatedly praised Kim, calling the dictator “open,” “honorable,” and “a pretty smart cookie.” Asked by ABC News’ George Stephanopoulos whether he trusts Kim, Trump replied, “I do trust him, yeah.” (In the same interview, the then-president added, in reference to Kim, “His country does love him. His people, you see the fervor. They have a great fervor.”) Trump’s affection for the North Korean leader reached new heights in October 2018. “We fell in love, OK? No, really,” Trump declared. “He wrote me beautiful letters, and they’re great letters. We fell in love.” But the Republican’s praise for the dictator has often been rooted in something specific. Six years ago, Trump was asked whether Kim might someday visit the White House. Trump said it “could happen,” before adding, “Hey, he’s the head of a country, and I mean he’s the strong head. ... [Kim] speaks and his people sit up at attention. I want my people to do the same.” It was not a one-off. In 2022, Trump appeared at a GOP fundraiser and marveled at how Kim’s generals and aides “cowered” when he spoke to them. “Total control,” Trump said of the dictator’s authoritarian model. Two years later, the former president is still talking about how impressed he is with Kim serving as “the absolute leader of that country.” This keeps happening for a reason: Trump expresses public admiration for dictators, not despite their authoritarian control, but because of it.
OpenAI forms safety council as it trains latest artificial intelligence model 2024-05-28 15:08:00+00:00 - OpenAI says it is setting up a safety and security committee and has begun training a new AI model to supplant the GPT-4 system that underpins its ChatGPT chatbot. The San Francisco startup said in a blogpost on Tuesday that the committee will advise the full board on “critical safety and security decisions” for its projects and operations. The safety committee arrives as debate swirls around AI safety at the company, which was thrust into the spotlight after a researcher, Jan Leike, resigned and leveled criticism at OpenAI for letting safety “take a backseat to shiny products”. The OpenAI co-founder and chief scientist Ilya Sutskever also resigned, and the company disbanded the “superalignment” team focused on AI risks that they jointly led. OpenAI said it had “recently begun training its next frontier model” and its AI models led the industry on capability and safety, though it made no mention of the controversy. “We welcome a robust debate at this important moment,” the company said. AI models are prediction systems that are trained on vast datasets to generate on-demand text, images, video and human-like conversation. Frontier models are the most powerful, cutting-edge AI systems. The safety committee is filled with company insiders, including Sam Altman, the OpenAI CEO, and its chairman, Bret Taylor, and four OpenAI technical and policy experts. It also includes the board members Adam D’Angelo, who is the CEO of Quora, and Nicole Seligman, a former Sony general counsel. The committee’s first job will be to evaluate and further develop OpenAI’s processes and safeguards and make its recommendations to the board in 90 days. The company said it will then publicly release the recommendations it is adopting “in a manner that is consistent with safety and security”.
I.R.S. Failed to Police Puerto Rico Tax Break, Whistle-Blower Says 2024-05-28 15:00:08+00:00 - For the past decade, thousands of wealthy Americans have been flocking to Puerto Rico to take advantage of a tax break that can cut their tax bills to zero. For nearly as long, there have been allegations that the benefit enables multimillionaires to avoid paying what they owe when they reap big investment profits. Now, an Internal Revenue Service insider has accused the agency of failing to police the tax break. Despite a high-profile campaign announced more than three years ago to unearth possible abuse, the agency has audited barely two dozen people and has collected back taxes from none, according to a letter that an agency insider wrote this year to lawmakers and that has been reviewed by The New York Times, as well as interviews with I.R.S. officials. Senate officials have begun an investigation into the whistle-blower’s allegations about the Puerto Rican tax benefit. “It’s been three years since the I.R.S. announced its enforcement campaign on this issue,” said Senator Ron Wyden, Democrat of Oregon and chairman of the Senate Finance Committee. “It needs to pick up the pace.”
Ross Stores: Buy Off-Price Retail While It’s Still a Bargain 2024-05-28 14:48:00+00:00 - Key Points Ross Stores had a solid quarter and guided higher, leading the analysts to lift their targets. Analysts are leading ROST stock to a new all-time high, about 15% above the current action. Ross Stores' value equation includes strong results, a healthy balance sheet, reliable dividends, and count-reducing share buybacks. 5 stocks we like better than Ross Stores Ross Stores NASDAQ: ROST isn’t a cheap stock trading 24 times its earnings, but it is a value for investors. Competitor TJX Companies NYSE: TJX trades at a similar valuation, about four handles greater than the average S&P 500 NYSEARCA: SPY stocks, for a reason. These companies are perfectly positioned for today’s retail environment and are among the best-operated businesses in America. Like any retail segment, off-price retail has its ups and downs, but it can profit in all conditions, and foresighted management teams keep the companies in fortress conditions. Today’s takeaway is that off-price retailers like Ross Stores outperform expectations, raise guidance and return, and build shareholder value. Get Ross Stores alerts: Sign Up Ross Stores Beats and Raises: Analysts Lead Stock to New High Ross Stores Today ROST Ross Stores $137.64 -4.49 (-3.16%) 52-Week Range $100.66 ▼ $151.12 Dividend Yield 1.07% P/E Ratio 23.21 Price Target $156.58 Add to Watchlist Ross Stores had a solid quarter, with revenue in Q1 growing 8%, accelerating from the previous year’s 4.65% to outpace consensus by 140 bps. The increase was driven by a 3% systemwide comp store gain compounded by a 4.5% increase in store count. The margin is also strong. Operating margin improved by 205 basis points on improved costs and spending discipline offset by a planned decline in merchandise margin. The net result is a 31.5% increase in net earnings and a 33% increase in generally accepted accounting principles (GAAP) earnings per share, aided by share repurchases. Guidance is solid. The company issued favorable guidance for Q2 and potentially cautious guidance for the year. The company expects Q2 results above the consensus estimate reported by Marketbeat at the time of the release and raised the outlook for full-year earnings. Full-year revenue guidance was maintained at 2% to 3%, but the outlook for earnings improved. The company targets a mid-point of $5.88, below the consensus estimate but much better than feared. Analysts responded favorably to the news and issued multiple price target revisions. All but one tracked by Marketbeat are upward, all but one are above the consensus estimate, and the sole outlier is a reiterated target also above the consensus estimate. The takeaway is that consensus implies a 10% upside and a new all-time high, while the freshest targets add as much as 13%. Ross Stores stock could hit a new all-time high soon in these conditions. Ross Stores Capital Return is Worth the Money Ross Stores trades at an elevated valuation, but it is worth the money because of its strong balance sheet and capital return. Balance sheet highlights include a cash build despite increased store count and associated inventory. Current and total assets are up, while liabilities are flat. A debt payment is due, but cash is robust and covers the payment. The debt-to-cash ratio, including current and non-current portions, is near 0.5 times cash and is lower compared to equity, which is also up. Shareholder equity is up by 6.5%. Regarding capital returns, the dividend isn’t much at a 1.% yield but is reliably safe and growing. The company cut distributions during the height of the pandemic but quickly resumed payments and has a solid history of increases. The payout ratio is attractively low at 23% of this year’s outlook, and the distribution compound annual growth rate (CAGR) is near 8%. Share repurchases compound the distribution and were worth $262 million in Q1, helping to reduce the average count by 1.8% year over year. There is nearly $2 billion left under the current authorization; the company plans to buy back $1.05 billion this year, or about 2.2% of the count. Ross Stores: A Trend-Following Signal Hits Critical Resistance Ross Stores' chart looks bullish with a solid trend-following signal on the weekly view. The signal is backed up by a bullish signal in the stochastic that moving average convergence divergence (MACD) may follow. However, the market is also facing resistance at a critical level, as seen in the daily view. The resistance resulted in a doji candle that could easily become a Shooting Star and Abandoned Baby. In this scenario, the market will be unable to move above $145 and become range-bound at current levels or correct to deeper levels, which is not expected. A new high is likely if this market can sustain its upward push and break above $145. Before you consider Ross Stores, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Ross Stores wasn't on the list. While Ross Stores currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
US tech firm agrees to $38,000 in penalties after ‘whites only’ job ad 2024-05-28 14:35:00+00:00 - A tech firm from Virginia has agreed to pay more than $38,000 in penalties after posting a job advertisement that solicited exclusively white, US-born applicants, the federal government has announced. Arthur Grand Technologies drew the scrutiny of anti-discrimination officials when it went on the hiring site Indeed.com in March 2023 and published an ad aiming to fill a business analyst vacancy while limiting applicants to “Only US Born Citizens [white] who are local within 60 miles from Dallas”. “[Don’t share with candidates],” the information technology services company’s advertisement, which was in bold text, added. Social media users and news outlets circulated the posting widely, prompting many to express shock that a job ad would so openly flout protections of nondiscrimination on the basis of race, color or national origin, among other categories. Within two months, the US justice department’s civil rights division opened an investigation into Arthur Grand. The company by Thursday had agreed to pay a $7,500 civil penalty to the US treasury as well as a total of $31,000 to people who filed discrimination complaints with the federal labor department over the job ad, a government news release said. Arthur Grand must also train its workers on the Immigration and Nationality Act, which prohibits discrimination based on citizenship status as well as national origin in hiring, firing or recruiting prospective employees. And the company said it would revise its employment policies while subjecting itself to justice department monitoring. A statement from the assistant US attorney general Kristen Clarke said it was “shameful … to see employers using ‘white only’ and ‘US born’ job postings to lock out otherwise eligible job candidates of color” at this point in the nation’s history. “I share the public’s outrage at Arthur Grand’s appalling and discriminatory ban,” Clarke’s statement added. In a statement reported by CNN, Arthur Grand’s chief executive officer, Sheik Rahmathullah, explained that “an upset employee on a performance improvement plan” published the notorious hiring advertisement without permission from a personal email address and account. skip past newsletter promotion Sign up to Headlines US Free newsletter Get the most important US headlines and highlights emailed direct to you every morning Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion The justice department’s news release added that its investigators determined a recruiter working for Arthur Grand’s subsidiary in India created the advertisement – for a position whose listed clients were HTC Global in Michigan and Berkshire Hathaway in Nebraska – and then posted it on Indeed. Arthur Grand, in a previous statement, said that the employee had grabbed an existing job posting and then introduced “discriminatory language” before publishing it on Indeed. “Upon discovering this, we took immediate and decisive action to ensure that this type of incident will never happen again, including the immediate termination of the responsible employee,” Rahmathullah said in the statement to CNN. Despite the financial penalties that Arthur Grand has accepted, Rahmathullah said his company “vehemently denies any guilt or wrongdoing in relation to the discriminatory job posting”.
Is Cigna Group the Nation's Best-Run Health Insurance Company? 2024-05-28 12:46:00+00:00 - Key Points The Cigna Group provides health, dental, vision, accident, pharmacy benefits management, life, homeowners and renters insurance. The Cigna Group saw the writing on the wall with Medicare Advantage (MA) expenses and unloaded its Medicare business for $3.7 billion to Health Care Services Co. While Humana cut its adjusted EPS guidance from $36.00 to a range of $6.00 to $10.00, Cigna beat Q1 2024 EPS by 25 cents and revenues by $660 million and then raised its full-year 2024 EPS guidance. 5 stocks we like better than The Cigna Group Health insurance companies in the medical sector have not fared well in 2024. Medicare Advantage (MA) plans were a bountiful source of income until the second half of 2023. Humana Inc. NYSE: HUM shocked the market with its drastic 2025 EPS guidance cut from $36.00 to a range of $6.00 to $10.00, attributed to rising inpatient utilization costs associated with MA plan members. It was a big surprise that the sickest demographic of insured patients, the elderly, was finally starting to eat into profits. Get The Cigna Group alerts: Sign Up Like Dominos, They Fall One by one, health insurers from UnitedHealth Group Inc. NYSE: UNH to CVS Health Co. NYSE: CVS owned Aetna were warning of rising MA expenses. However, one major health insurer is no longer impacted by MA plans. This insurer may be the best-run health insurance company in the nation: The Cigna Group NYSE: CI. Cigna Saw the Writing on the Wall The Cigna Group Today CI The Cigna Group $333.21 +0.60 (+0.18%) 52-Week Range $240.50 ▼ $365.71 Dividend Yield 1.68% P/E Ratio 27.36 Price Target $366.14 Add to Watchlist Cigna saw the proverbial writing on the wall early on and took action. Cigna unloaded and sold its Medicare business, which includes Medicare Advantage plans, to Health Care Service Co. NASDAQ: HCSG for $3.7 billion. Cigna also operates its pharmacy benefits management (PBM) unit, which was created from the $67 billion acquisition of Express Scripts in 2018. The Cigna Group also offers whole life and group life insurance and has partnered with Lifestyle Benefits to offer auto, home and renters insurance. Daily Inverse Cup Pattern CI formed a bearish daily inverse cup pattern. The inverse cup lip line formed at the $331.02 swing low on March 1, 2024. CI rallied to a high of $365.71 before falling back down to retest the cup lip line on May 24, 2024. This will either be a double bottom or trigger a small bounce to form a handle that peaks and falls through the lip line, triggering an inverse cup and handle breakdown. The bull case would be a double bottom that causes CI to reverse back into an uptrend. The daily relative strength index (RSI) is slipping back down towards the 30-band. Pullback support levels are at $325.08, $315.05, $309.07 and $303.69. Robust Business Cigna reported Q1 2024 EPS of $6.47, beating analyst estimates by 25 cents. Revenues rose 23.2% YoY to $57.25 billion, beating $56.59 billion analyst expectations, a $660 million beat. Total pharmacy customers rose 25% sequentially due to new sales and continued relationship expansion. Total medical customers were 19.2 million. Behavioral care customers were 23.8 million. Raised Guidance Cigna expects FY 2024 EPS of at least $28.40, up from $28.25, compared to $28.42 consensus analyst estimates. Full-year 2024 revenues of at least $235 billion are also expected compared to $235.04 consensus estimates. CEO Insights The Cigna Group CEO David Cordani pointed out that its Evernorth and Cigna Healthcare businesses contributed 60% and 40% of its earnings, respectively. Cigna Healthcare achieved strong performance with its focus on affordability and disciplined pricing. Its medical care ratio (MCR) was 79.9%. This is just a tick under the Affordable Care Act (ACA) minimum of 80%. MCR is the percentage of premium revenue spent on healthcare claims. Cigna launched its EncircleRx solution to enhance outcomes for cardio diabesity, which is an expansion to its GLP-1 management solution. The program offers an industry-first financial guarantee, allowing greater predictability in the costs of covering the medications. GLP-1s are currently the top driver of drug spending, forcing employers to rethink their coverage options. EncircleRx has already grown to over 1 million enrollees. Biosimilar Growth Opportunity Evernorth saw strong growth in its Pharmacy Benefits Services as it gained traction with large commercial employers and governmental organizations. Cordani addressed the interchangeable biosimilar (generic) program, which enables over 100,000 Accredo patients in the Specialty business within Evernorth to use biosimilar Humira, which is priced 85% cheaper, enabling cost savings of $3,500 on average per user. Cordani commented, “And in addition to Accredo patients, all of our pharmacy benefit service clients and patients will have access to these biosimilars. Importantly, the biosimilar opportunity goes well beyond Humira. By 2030, we expect to see biosimilars or generics introduced for nearly half of the top 25 specialty drugs in the United States.” Cordani concluded, “This translates to over $100 billion in annual spend, subject to additional choice and competition. The introduction of biosimilars creates a multiyear tailwind that enables us to continue to drive growth and value-creation for the benefit of those we serve.” The Cigna Group analyst ratings and price targets are on MarketBeat. Before you consider The Cigna Group, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and The Cigna Group wasn't on the list. While The Cigna Group currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
China Chipmakers Catching Up Fast in AI, SenseTime’s Xu Says 2024-05-28 12:11:00+00:00 - (Bloomberg) -- China’s domestic AI chipmakers are making fast progress in closing the gap on international leaders, according to SenseTime Group Inc. co-founder Xu Bing. Most Read from Bloomberg Asia has a shortage of computation power for artificial intelligence, lagging significantly behind the US, but China has the talent and data to make up lost ground, Xu said in an interview at the UBS Asian Investment Conference in Hong Kong. SenseTime is one of China’s artificial intelligence pioneers, though it’s been placed on a US investment blacklist as part of sweeping American sanctions curbing the country’s advances in AI. China’s progress in this field has been made more difficult by US trade controls preventing the import of Nvidia Corp.’s advanced AI accelerators. That’s sparked the need for domestic alternatives from the likes of Huawei Technologies Co. and Shanghai Biren Technology Co., which are both also subject to US trade restrictions. “There’s a shortage of resources here in Asia in general,” Xu told Bloomberg’s David Ingles. “It’s like a 10 times gap of the compute resources that we have here compared to the US leaders. But I think Asian markets never lack talent and never lack data.” SenseTime aims to turn profitable within the next two years, Xu said. It’s raised $6 billion over the past decade and invested a third of that into research and development, including more than $1 billion on AI accelerator infrastructure. Its shares fell as much as 3.7% in Hong Kong on Tuesday, extending a week of decline. What Bloomberg Intelligence Says SenseTime Co-founder Xu Bing’s assertion that the company can break into profit in the next 1-2 years on Bloomberg TV is too optimistic. We remain pessimistic about the narrowly-focused, sub-scale firm’s chance of entering sustained profitability. With just 4.6 billion yuan net cash on its balance sheet at the end of 2023, we think SenseTime will need to raise new capital during the next 12 months. SenseTime lacks a discernible competitive edge, burning though 4.7 billion yuan cash in 2023. — Robert Lea and Jasmine Lyu, BI analysts Xu added that domestic chips in China are catching up quickly and SenseTime is working with local semiconductor companies to expand the compute capabilities that they have. He did not name specific firms, but Huawei has quietly become China’s chip technology development champion, having successfully worked around US curbs to develop its own advanced smartphone processor last year. Story continues Xu said it’s not clear how far China is behind the US now, with some people estimating a year and others three years. But he said the country’s disadvantage in computing power won’t be permanent. “Compute is a commodity,” he said. “In the long run, compute won’t be a gap.” Beside Huawei and Biren, another chipmaker that’s shown promise on the AI front is Moore Threads Intelligent Beijing Co. Chinese Premier Li Qiang met with Moore Threads’ chief executive officer in March on a tour of the country’s top AI and chipmaking firms, including AI developer Baidu Inc. and chip manufacturing gear maker Naura Technology Group Ltd. (Updates with share price in fifth paragraph and analyst reaction) Most Read from Bloomberg Businessweek ©2024 Bloomberg L.P.
Asia shares drift after rally, Wall Street reopen in focus 2024-05-28 10:46:00+00:00 - By Stella Qiu SYDNEY (Reuters) - Asian shares held a mixed tone on Tuesday after rallying the previous session, as rising bets of an imminent European rate cut helped risk appetite ahead of some key inflation data. A slew of European Central Bank officials said overnight the ECB has room to cut interest rates as inflation slows, underscoring expectations for a rate cut on June 6. With debate now shifting to subsequent moves, markets have fully priced in two rates cuts by October this year. That helped Wall Street stock futures firm ahead of the reopening of U.S. markets after a public holiday. S&P 500 futures rose 0.1% and Nasdaq futures gained 0.2% before a line-up of Federal Reserve speakers later in the day for the latest guidance on rate outlook. MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.4%, thanks to a 0.7% gain in Hong Kong's Hang Seng index, after gaining 0.9% on Monday. Japan's Nikkei, on the other hand, slipped 0.3%, reversing some of the 0.7% advance a day ago. "We're heading into the northern hemisphere summer season. Traditionally that's a time when markets just tend to get in that drift mode. We've got through earnings season," said Tony Sycamore, an analyst at IG. "To find a driver it's got to be something from out of left field and in lieu of that, generally we see markets drift higher and I think that's what we're seeing at the moment." Chinese blue chips lost 0.1% after firming 1% a day earlier as tech shares surged on Beijing's further commitment to invest in its semiconductor industry. [.SS] The big risk events this week are not due until Friday when U.S. figures on core personal consumption expenditures (PCE) - the Federal Reserve's preferred measure of inflation - and euro zone inflation data will set the trading tone. In foreign exchange markets, the dollar was on the back foot for the third straight session as traders positioned for the PCE release. Median forecasts are for a rise of 0.3% in April, keeping the annual pace at 2.8%, with risks on the downside. The Japanese yen steadied at 156.80 per dollar, just a touch stronger than the key 157 level. It, however, kept weakening against a slew of high yielding currencies, with the New Zealand dollar hitting a fresh 17-year top of 96.56 yen on Tuesday. [FRX/] Thanks to the strong carry demand, the kiwi hit a 2-1/2-month high of $0.6155. The cash Treasuries market returned from a holiday with little movement after taking a hit last week. Two-year yields fell 1 basis point to 4.9396%, having surged 13 bps the previous week, while the 10-year yield held at 4.4649%, after rising 5 bps the week before. Story continues Oil prices were mostly steady on Tuesday. Brent futures rose 0.1% to $83.19 a barrel. [O/R] Gold prices climbed for a third day, up 0.1% at $2,354.23 per ounce. (Reporting by Stella Qiu; Editing by Jacqueline Wong)
New Petrobras Head Pledges Investor Returns After CEO Upheavel 2024-05-28 10:01:00+00:00 - (Bloomberg) -- The new CEO of Brazil’s Petrobras has tried to soothe investor concerns about ramping up investments during her first public comments at the helm of Latin America’s biggest oil producer. Most Read from Bloomberg Magda Chambriard was formally appointed to the role last week at a time of growing concern from investors about government intervention in Petroleo Brasileiro SA. Her predecessor was fired due to a dispute over the amount of dividends the company paid instead of using the money for investments. “Petrobras is perfectly capable of guaranteeing returns for its shareholders, whether private or governmental,” Chambriard said Monday in her first public comments as CEO. “I understand we need to make a profit.” President Luiz Inacio Lula da Silva has made it clear that he would like state-controlled Petrobras to spend more money on expanding in sectors including refining and creating jobs. The government controls the oil producer’s board through a majority of voting shares. Under Lula, Petrobras has already shifted from the previous administration’s focus on streamlining operations to cut costs. The company has called off a program to sell a group of refineries and may even buy back some of the facilities that were sold under previous management. Read More: Petrobras Approves Chambriard as CEO to Ramp Up Investment Chambriard — a former head of Brazil’s oil regulator — said the company needed to accelerate exploration off Brazil’s coast, including the Pelotas Basin and a region known as the equatorial margin near the border with French Guiana. She has criticized licensing delays for drilling at an environmentally sensitive site in the equatorial margin, saying they are leaving the nation without a source of growth after its top-oil producing basin, the pre-salt, declines. “We have to be very careful with replenishing reserves, unless we want to accept the fact that we could become importers again,” she said. Read More: Petrobras CEO Faces Showdown Over Amazon Oil: Energy Daily On domestic fuel costs, Chambriard said that Petrobras will continue to work to shield consumers from short-term dips and swings in oil prices. After Lula took office in 2023, Petrobras changed its pricing policy to focus more on production costs rather than international price levels. Story continues --With assistance from Beatriz Amat. Most Read from Bloomberg Businessweek ©2024 Bloomberg L.P.
Temu’s Parent PDD Trades Near Cheapest Level Ever as Geopolitical Risks Bite 2024-05-28 09:32:00+00:00 - (Bloomberg) -- Shares of Temu parent PDD Holdings Inc. are being held back by geopolitical risks and fierce competition in China’s e-commerce sector. Most Read from Bloomberg Granted, it US-listed stock has surged 43% surge from a March low, but it’s still trading at just 13 times expected earnings for the next year. That’s half the valuation of the Nasdaq 100, marking PDD’s steepest discount on record. That might seem like a great bargain for a company that more than doubled sales in the latest quarter, a pace of growth second only to Nvidia Corp.’s on the tech-focused index. Some see the gap as justified given the harsh trade-war rhetoric from Beijing and both candidates in the upcoming US presidential poll. “People are worried about election risks and potential tariffs coming for PDD, leading many to attach zero or even negative value to Temu,” said Shuyan Feng, deputy general manager for investment management at Huatai Asset Management (Hong Kong). Read More: A New Trade War Offers No Easy Way Back for Old Global Order PDD’s earnings more than tripled in the March-ended quarter as the company successfully pushed its budget e-commerce model into overseas markets. The high growth in Temu has drawn scrutiny in key Western markets, with European complaints that the Chinese online marketplace fails to protect consumers. Troubles run deeper in the US, where lawmakers have alleged Temu and rival Shein exploit loopholes to the disadvantage of US competitors. The US government’s recent order for ByteDance Ltd. to divest TikTok has piled further pressure on fellow Chinese internet firms. Intense rivalry within China is another source of worry. After ceding market share for years, PDD’s arch-rival Alibaba Group Holding Ltd. posted double-digit growth in gross merchandise value in the latest quarter. Sales growth also quickened at JD.com Inc., which has slashed prices and ramped up perks to woo shoppers. Not that investors have been avoiding PDD — its 43% gain since March is ten times the advance in the Nasdaq 100. But that’s been far outpaced by the nearly 60% rise in forward earnings estimates in the same span of time. Goldman Sachs Group Inc. upgraded PDD to buy from neutral on Friday, citing the company’s strong revenue growth and adtech capabilities. The main negative factors of tough domestic competition and tensions with the US are “more than priced in,” according to analyst Ronald Keung. Story continues “China e-commerce is emerging as one of the more undervalued sub-sectors within China internet,” Keung wrote in a note. “We note there still appears to be limited investor appetite in valuing the Temu full business potential given geopolitical uncertainties.” A further reason for PDD’s valuation discount could be its lack of shareholder return initiatives while the likes of Alibaba and Tencent Holdings Ltd. repurchase billions of dollars worth of stock. Except for PDD, all top 15 members of the exchange-traded Kraneshares CSI China Internet Fund have either a buyback program or a regular dividend payout policy in place. One more thing that could be holding PDD back is its unclear information for investors. PDD doesn’t report revenue by region, and its business segments can be difficult to parse. “The main thing holding back on PDD’s valuation is the lack of disclosures,” said Xin-Yao Ng, investment director at Abrdn. “It’s very difficult to value domestic PDD and Temu separately, and that’s important because there’s definitely a big geopolitical discount on the stock due to Temu.” Top Tech Stories Equity investors are scouring Southeast Asia for alternatives to play the artificial intelligence theme as tech giants pour billions of dollars in infrastructure spending over the next few years. Asia’s richest man Mukesh Ambani is set to enter Africa with a telecom venture, seeking to win mobile broadband customers in a high-growth market. Bets on more Ether gains are intensifying following a surprise US regulatory pivot toward allowing exchange-traded funds for the digital asset, even as questions swirl about the strength of demand for the products. Most Read from Bloomberg Businessweek ©2024 Bloomberg L.P.
Catering to the Ultra-Rich Is a Booming Business in Australia 2024-05-28 08:51:00+00:00 - (Bloomberg Markets) -- Peppermint Grove, a suburb of Perth in Western Australia, has all the trappings you’d expect of one of the wealthiest postal codes in the country: sprawling riverside mansions, exclusive schools and a yacht club. Most Read from Bloomberg But lately there’s a new sign that the Perth elite are starting to tip over the line separating the merely rich from the fabulously so. Glance in a real estate agent’s window, and you’ll often see properties advertised with a telltale phrase: “Perfect for a family office.” Financial hubs such as Dubai, London, New York and Singapore have long dominated the rarefied world of family offices—outfits that typically cater to a single $100 million-plus client with services that can include managing money, taxes, charitable donations and even household help. Since 2019, as the rich get richer, the number of family offices worldwide has more than tripled, to almost 4,600 last year, according to investment data provider Preqin Ltd. But the wealthy don’t live only in global glamour cities. Family offices are now popping up in places like Perth, on the coast of the Indian Ocean, 1,300 miles from Adelaide, the nearest major metropolitan area, and closer to Jakarta than Sydney. After an almost two-decade-long mining boom, Perth, with a population of more than 2 million, has 64 centi-millionaires. That places it among the richest cities in the world by that measure, tied with Stockholm and ahead of Berlin and Dublin, according to data from citizenship consulting firm Henley & Partners. Andrew Forrest and his family top the list of the richest Australians, with a fortune of $29.2 billion in mid-May, according to the Bloomberg Billionaires Index. He grew up in the outback and founded the iron ore miner Fortescue Ltd., which is based in Perth. Andrew and Nicola Forrest call their family office Tattarang; it invests in public and private companies and works with their philanthropic Minderoo Foundation. (In 2023 the couple announced their separation, but said there would be no impact on their shared ventures.) Tattarang’s “bespoke model” helps its founders fund “strong and sustainable businesses across sectors where we believe we will have the greatest impact—for example, renewable energy, critical minerals, agri-food and health technology,” a spokesman says. Story continues Other affluent families are less well-known, making their mark selling tools to miners as well as other businesses that have benefited as the size of the mining sector has more than doubled since 2000, to 13% of Australia’s gross domestic product. Shaun Parkin, who helps families set up and manage their offices, says he works, or has had meetings, with more than 20 of these companies, each of them overseeing more than A$200 million ($131 million) in assets. “A lot of the ones that I meet, I had no idea that there was that level of wealth,” says Parkin, founder of local consulting firm Hall Road Investments. “And I would say that most people haven’t, either.” Family offices have some universal attractions. They typically have minimal disclosure requirements and let the rich exert tight control. But in Perth there’s an added fillip: Many locals have a deep-seated skepticism of outsiders. That most definitely includes representatives from big global wealth managers who want to run their money from far away. Consider Perth native Rod Jones, a founder of the education company Navitas Ltd. In 2019 a group led by private equity firm BGH bought Navitas for A$2.1 billion, so it was no secret Jones might need wealth management. But he got so annoyed at countless calls from distant professionals pitching opportunities or looking to handle his funds that he reached the point where he told one, only half in jest, “Look, I’ll give you $200,000 just to go away.” Instead, Jones set up a five-employee family office, Hoperidge Capital. It invests in some blue-chip stocks but focuses mainly on direct holdings, including private credit. “I’m just a person that enjoys the cut and thrust of being in business, putting time and effort into picking good opportunities and backing them up,” he says. Cookie-cutter pitches are of little interest. “To invest with someone, I’ve got to meet you, I’ve got to understand you, I’ve got to know you, I’ve got to feel comfortable with you.” Other Western Australia family offices share this desire for familiarity. Many are clustered within walking distance of one another in what’s known as the Golden Triangle, an exclusive group of suburbs between the Swan River and the coast. Emilio Pagano, chief executive officer of Lance East Office, says he talks regularly with more than a dozen of his peers about longer-term investments that appeal to their clients’ entrepreneurial bent. Lance East manages the money and philanthropy of Laurence Escalante, founder of VGW Holdings Ltd., a closely held online gambling company, who has a personal fortune of about $2 billion, according to the Bloomberg Billionaires Index. Family office clients are often comfortable with risk because of Western Australia’s mining heritage, according to Pagano. “Think about how mining eventuates,” he says. “You go out in the middle of nowhere, starting from the most remote capital city in the world. And then from there you drive out 3, 4, 500 kilometers, and you start looking around the desert for mining assets and digging.” Family office clients are often comfortable with risk because of Western Australia’s mining heritage For all the opportunity, a remote location poses a challenge: Where do you find the staff with the knowledge to compete or negotiate with the finance big shots? Perth has only 13,000 full-time financial-services managers or professionals, compared with 108,000 in Sydney, census figures show. Family offices are typically run by a CEO or chief investment officer and as many as 10 staff members. Insiders say the top job tends to go to someone who’s worked in the founder’s business operations and is already a trusted adviser. CEOs commonly take home a salary of A$396,001 to A$500,000, with an additional annual bonus of 21% to 30%, according to a report from consulting firm KPMG and family office recruitment company Agreus Group. That’s more than their peers in Europe, though less than in the US. (The report doesn’t break out Perth salaries, but industry executives say they are broadly comparable.) Parkin, the family office adviser, says recruiting has to be a “little bit more imaginative” in Perth. He’ll often trawl LinkedIn profiles for people who grew up or attended university there and might be amenable to moving back.He knows the transition well: He worked in finance in London, had a senior job at State Street Global Advisors in Sydney and relocated back to Perth, he and his wife’s hometown, to be close to family. The more relaxed lifestyle is another draw. In Perth, days often start and finish early, and some of the world’s best beaches are just a short drive away. But there’s another angle to the pitch, too. Family offices work directly with billionaires and centi-millionaires, giving advisers a bigger say in decisions. “You probably wouldn’t get access if you were part of a larger business,” Parkin says. The industry is now looking to the next generation. Today’s mining magnates will one day hand over their businesses or wealth to their kids. In a booming economy, opportunities in construction and service industries could create the next round of family office customers. Tayyab Mohamed, Agreus’ co-founder, says the market could well grow far bigger: “I wouldn’t be surprised if in a few years Perth becomes a bustling ecosystem.” —With Ben Stupples in London Brumpton is a Bloomberg News reporter in Sydney; Hunt, in Melbourne; and Winters, in Singapore. (Adds details on personal background, latest professional affiliation for Parkin.An earlier version corrected the spelling of a company name in paragraph 12.) Most Read from Bloomberg Businessweek ©2024 Bloomberg L.P.
Trump Widens Lead Over With Biden (on Polymarket and PredictIt) After Courting Crypto Vote 2024-05-28 06:04:00+00:00 - This week in prediction markets: Courting crypto voters appears to have boosted Trump's odds. Doug Burgum still trails behind Tim Scott for Republican VP pick. Longshot ether ETF approval contract prints triple-digit return for bettors, despite disputes over its resolution. Taking a strong pro-crypto stance may have strengthened Donald Trump's lead over incumbent president Joe Biden – at least if you go by the prediction markets. In the past week, Trump has promised to commute the sentence of Silk Road founder Ross Ulbricht – a figure near and dear to many in the crypto community – and vowed to make the U.S. a leader in the digital assets industry. It's a markedly more solicitous stance than the Biden administration has taken. Over the same period, Biden "yes" shares on PredictIt , an election betting platform popular among retail traders that settles trades in dollars, have slipped from 46 cents to 44 cents. Each share pays out $1 if Biden is reelected, and nothing if he loses. Effectively, the 44 cent price means the market sees a 44% chance he will be re-elected. Crypto-based Polymarket, which technically bans U.S. residents from using its service, has shown a similar shift in the odds. Trump has gained two percentage points on the platform over seven days, putting his odds at 56%, while Biden is down two percentage points, at 37%. The polls have shown neither as dramatic a gap between the two candidates, nor as dramatic a shift in the last week. Trump's polling lead has climbed just 80 basis points, to 1.7%, according to FiveThirtyEight averages . Proponents of prediction markets argue that they can be a more reliable gauge of sentiment and forecasting tool because unlike people answering questions on the phone, bettors have skin in the game. The markets have also taken an interest in North Dakota governor Doug Burgum as a possible running mate for Trump. Burgum has been a recent speaker at Trump rallies and the subject of a Wall Street Journal profile where Republican insiders describe him as a "rich guy with rich friends, which goes a long way with Trump." On Polymarket , Burgum shares are up three percentage points, currently trading at 18%, or 18 cents, while on PredictIt , they are down slightly, trading at 15 cents. On both platforms, Burgum trails Tim Scott, who's maintaining a lead of 23% on PredictIt, and 27% on Polymarket, well ahead of establish Republicans like Marco Rubio, at 10% on Polymarket, or Nikki Haley, at 4%. Ether ETF bets pay off bigly An arcane dispute has arisen on Polymarket regarding the resolution of the contract over whether the U.S. Securities and Exchange Commission would bless ether ETFs. Bettors are clashing over whether "approval" means only the 19b-4 forms or also the S-1 filings. Story continues Rather unexpectedly, the SEC asked last week for updated 19b-4 filings from prospective issuers of Ethereum exchange-traded funds (ETFs). Days later, these filings – critical documents in the approval process – were green-lit by the SEC , stunning longtime analysts. It was thought that the SEC's uncertain view on ether's status as a security would delay things. But as baseball legend Yogi Berra said, it ain't over 'til it's over. Although the SEC has approved the 19b-4 forms for the ETFs, it must still approve the S-1 filings before trading can begin, James Seyffart, ETF analyst at Bloomberg Intelligence, told CoinDesk . "ETFs are not considered 'approved' until both the relevant registration form (such as S-1, N-1A, or N-2) & the 19b-4 filing have been signed off on by the SEC," Matthew Sigel, VanEck's head of research, posted on X (formerly Twitter). Despite these bureaucratic technicalities, the Polymarket contract, which received over $13 million in bets, still resolved to "yes," meaning the contract's "oracle," or referee, decided the matter was settled. And that has led to some long-shot money being made. One user going by the handle Paperliss , who bought in near the bottom of the market at 7 cents, turned just over $300 into $4,358 for a return of 1,329%. Meanwhile, the largest holder of "Yes" shares in the contract, notgonnatrickme , posted a return of 61%, bringing his or her bet of just over $10,000 to a value of $16,902 when the contract closed.
Exxon Investor Sued for Climate Proposal Promises to Back Off 2024-05-28 04:42:00+00:00 - (Bloomberg) -- The Exxon Mobil Corp. investor that the oil giant is suing for its climate-related shareholder proposal is promising not to file similar motions in the future in a bid to get the legal action dropped. Most Read from Bloomberg While Arjuna Capital had already withdrawn the shareholder proposal to accelerate greenhouse-gas emissions cuts that was at issue in the lawsuit, the firm went further in a letter that was sent to Exxon and filed with a Texas court, saying it “unconditionally and irrevocably” promised not to submit any more proposals related to emissions or climate change to Exxon shareholders. Arjuna said it expects Exxon will now withdraw its lawsuit. Exxon is reviewing Arjuna’s letter, spokeswoman Emily Mir said in an emailed statement that didn’t commit to withdrawing or continuing the lawsuit. The oil producer’s lawsuit is intended to gain clarity on the US Securities and Exchange Commission’s proxy rules and stop the abuse of the shareholder process, Mir said. Read More: Exxon Suit Targeting Activist Climate Proposals Moves Ahead Most Read from Bloomberg Businessweek ©2024 Bloomberg L.P.
Top K-pop stocks fall after reports that Hybe may sell $50 million stake in SM Entertainment 2024-05-28 04:40:00+00:00 - Shares of two of South Korea's largest K-pop companies fell on Tuesday after industry giant Hybe is said to be pushing for a $50 million sale of its stake in SM Entertainment. Kospi-listed Hybe's stock slid as much as 2.4%, while SM Entertainment — which is listed on the Kosdaq —saw its shares plunge as much as 5.74%. South Korean media outlet Chosun Ilbo reported that Hybe — the agency that manages K-pop sensation BTS — intends to make the transaction a block deal of 750,000 shares. The news outlet also said the sale was because Hybe decided its stake "was a minority stake that had no influence on SM's management rights, it would be better to sell it in large quantities and realize profits." According to the Chosun Ilbo, the shares will be sold at a 4% to 5.5% discount to SM's last closing price of 95,800 South Korean won. That puts the sale price per share at between 91,968 to 90,531 won. This means the total transaction value would come up to about 68 billion won, or about $50 million. Before the transaction, Hybe held a 12.45% stake in SM. CNBC reached out to SM Entertainment for comment, but did not immediately receive a reply.