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☆ Why Some Investors Are Betting on China’s Recovery but Avoiding Chinese Shares
▼ + stars: | 2023-05-15 | by ( Weilun Soon | ) www.wsj.com time to read: 1 min

Luxury conglomerate LVMH Moët Hennessy Louis Vuitton is one of the top picks of international investors betting on China’s recovery. Photo: Qilai Shen/Bloomberg NewsGlobal investors wanting to profit from China’s economic recovery are increasingly turning to companies in Paris, Las Vegas and beyond. They are loading up on shares of European, American and Japanese companies instead of Chinese stocks, as high geopolitical tensions between Beijing and Washington have made it unpalatable for some international money managers to invest in Chinese companies.

☆ Bank of America loves these 10 unloved global stocks with major upside
▼ + stars: | 2023-05-15 | by ( Ganesh Rao | ) www.cnbc.com time to read: +2 min

Bank of America strategists have named the ten European stocks they believe are currently undervalued and could provide significant investment returns. These picks, which the investment bank refers to as the "Beat Factor Top 10," are primarily made up of industrial and financial companies. Bank of America analysts expect shares of Airbus to rise by 64% to 200 euros per share ($217) over the next 12 months. The "Beat Factor" is a measure Bank of America analysts use to identify the most divergent stock ideas on the FTSE Eurofirst 300. Despite the share price gains, Bank of America strategists remain bullish on the stock coming out of the earnings season.

☆ The Young LVMH Heir Turning TAG Heuer Into a Billion-Dollar Brand
▼ + stars: | 2023-05-14 | by ( Nick Kostov | Stacy Meichtry | ) www.wsj.com time to read: 1 min

GENEVA—Among the many luxury labels that form LVMH Moët Hennessy Louis Vuitton lies an upper-echelon of brands that generate more than $1 billion in annual revenue, driving the conglomerate’s business. Frédéric Arnault —chief executive officer of TAG Heuer and the third son of LVMH’s top boss, Bernard Arnault —said the Swiss watchmaker is about to join those ranks.

☆ The 28-Year-Old LVMH Heir Turning TAG Heuer Into a Billion-Dollar Brand
▼ + stars: | 2023-05-14 | by ( Nick Kostov | Stacy Meichtry | ) www.wsj.com time to read: 1 min

☆ Starbucks, Estée Lauder, Qualcomm: Global companies warn of slower-than-expected recovery in China
▼ + stars: | 2023-05-11 | by ( Michelle Toh | ) edition.cnn.com time to read: +6 min

Starbucks (SBUX) and Qualcomm (QCOM) have also flagged uncertainties related to the country, which is a top market for both. Beijing abandoned its zero-Covid policy in December and scrapped longstanding quarantine requirements for international arrivals in January, ending restrictions that had isolated its economy. The welcomed, if abrupt, policy U-turn led to hopes that China could help propel global growth as it had before the pandemic. The idea was that as soon as the zero-Covid policy would be over, the Chinese households and consumers would just go berserk. Starbucks warned last Tuesday that sales growth in China was starting to cool — and likely would continue that trajectory over the next six months.

"We are looking into ways to express this (China recovery) theme in our portfolio rather than just say 'let's go long China equity'. "Given the higher risk premium of China stocks, the demand for 'shadowing' China will continue to be strong," Jefferies said. The relative cheapness of European stocks, at least at the start of this year, has also been important. Luxury stocks - less vulnerable to sanctions - have performed well, but geopolitical worries have bruised tech firms, and manufacturing difficulties have hurt commodity stocks. "What is doing extremely well this year is luxury; if you'd bought European miners hoping that China would stimulate, you'd have got it wrong."

☆ Here are 10 global stocks analyst love coming out of the earnings week, Bank of America says
▼ + stars: | 2023-05-08 | by ( Ganesh Rao | ) www.cnbc.com time to read: +3 min

However, according to strategists at Bank of America, there were more downward than upward revisions of company earnings estimates by analysts. The investment bank said European companies saw a decrease in their earnings per share (EPS) revision ratio to 0.85 in April, down from 1.12 in March. Analysts tend to downgrade stocks despite companies reporting bumper profits if those earnings are unlikely to grow in the future. The below table highlights 10 European large-cap stocks with high EPS revision ratio, according to Bank of America. The EPS revision ratio for Novo Nordisk was also in positive territory, thanks to its blockbuster weight-loss drug Wegovy and others in the pipeline.

☆ Morning Bid: German data in the rear-view mirror
▼ + stars: | 2023-05-05 | by ( ) www.reuters.com time to read: +2 min

A look at the day ahead in European and global markets from Vidya Ranganathan. The euro is digesting a widely anticipated hawkish quarter-point rate rise from the European Central Bank, and is off its one-year highs. While ECB President Christine Lagarde was clear more tightening will come, markets are paring back their expectations for further rate rises . In the background, there's also evidence that travellers from a reopened China flocked to Europe during their May Day break early this week. Reuters GraphicsKey developments that could influence markets on Friday:Economic data: German March industrial orders, Swiss forex reserves, UK PMI, US non-farm payrolls.

But with flights remaining limited after China's border reopening in January, European luxury stores will need to wait longer for the return of masses of tourists they once depended on for growth. The average transaction value by Chinese travellers in Europe in March was 28% above 2019 levels, UBS said, citing data from VAT refund provider Planet. Cartier-owner Richemont (CFR.S), Hermes (HRMS.PA) and LVMH were best placed to benefit from wealthy Chinese shoppers, UBS added. As wealthy Chinese return to Europe and other foreign destinations, the appeal of China's Hainan Island, a duty free shopping hotspot, appears to be waning among top luxury spenders. China's "higher income, top luxury spenders (are) already travelling abroad again," she said, leading to an observable lower per-capita spend in Hainan.

☆ There's a real-life 'Succession' drama playing out among the children of Bernard Arnault, the world's richest person and head of luxury behemoth LVMH
▼ + stars: | 2023-05-05 | by ( Pete Syme | ) www.businessinsider.com time to read: +5 min

But there's a similar legacy battle going on inside LVMH, the French luxury house run by Bernard Arnault. The children of the world's richest man are vying for influence within LVMH in a "Darwinian" fight. Showrunner Jesse Armstrong says his fictional Roy family is inspired by several famous dynasties, such as the Hearsts — the family behind Hearst Communications — and the Redstones — the controlling influence behind Paramount Global. There's still plenty of rivalry between the progeny of Bernard Arnault, CEO of luxury goods behemoth LVMH and world's richest person. The Roy family of "Succession."

☆ Flying high on obesity success, Novo's appetite for deals grows
▼ + stars: | 2023-05-04 | by ( Natalie Grover | ) www.reuters.com time to read: +2 min

Its interest is largely in areas it has already invested in, including diabetes, obesity, cardiovascular disease and gene therapies, he said on a panel at the LSX World Congress conference. Since launching its popular Wegovy weight-loss drug in the United States in June 2021, Novo's shares have soared by 140%. The company has traditionally taken a wait-and-see approach to deals, often waiting for drugs to have success in later-stage trials before going for a deal. Since joining the drugmaker in 2018, the company has grown its business development capacity. "If you look at some of our competitors, there are hundreds of people in business development ... and we probably have 25," he said.

☆ Novo Nordisk cuts some US supply of obesity drug Wegovy to cope with demand
▼ + stars: | 2023-05-04 | by ( Nikolaj Skydsgaard | ) www.reuters.com time to read: +3 min

SummarySummary Companies Novo halves supply of Wegovy starter doses in U.S. "To safeguard continuity of care, the supply of the lower Wegovy dose strengths in the US will be reduced temporarily," Novo said in a statement. Novo has faced supply constraints for its hugely popular Wegovy drug as a result of overwhelming demand, and has invested massively in increasing supply. Supply of starter doses in the U.S. would be cut by around 50% for "some months," Jorgensen added. Credit Suisse analysts said they were not surprised by the move, given the level of demand for the drug.

☆ Factbox: Warren Buffett, Berkshire Hathaway at a glance
▼ + stars: | 2023-05-04 | by ( ) www.reuters.com time to read: +8 min

[1/2] Berkshire Hathaway Chairman Warren Buffett walks through the exhibit hall as shareholders gather to hear from the billionaire investor at Berkshire Hathaway Inc's annual shareholder meeting in Omaha, Nebraska, U.S., May 4, 2019. REUTERS/Scott Morgan/File PhotoMay 4 (Reuters) - Tens of thousands of people are descending on Omaha, Nebraska to attend the annual shareholder weekend for billionaire investor Warren Buffett's Berkshire Hathaway Inc (BRKa.N). Susan Buffett and Howard Buffett are Berkshire directors. His Berkshire stock will go to philanthropy after he dies. (Interview with CNBC, April 12, 2023)Abel on Berkshire managers' relationship with him: "It's not the same as working for Warren.

SummarySummary Companies Co expects annual net sales to fall 10% to 12%Expects annual adj. Barclays analyst Lauren Lieberman said in a note Estee's profit forecast was the "last thing" expected even by the Street. Even though China relaxed pandemic-related restrictions, the company saw January 2023 pressured by retailers destocking due to an increase in COVID-19 cases. Estee expects full-year 2023 net sales to fall between 10% and 12%, compared with its prior forecast of a 5% and 7% decrease. It also forecast adjusted profit per share to fall between 50% and 51%, compared with a 27% to 29% decrease it expected earlier.

☆ A Baillie Gifford manager who oversees a $564 million fund details 4 of the top investing themes she's pursuing, including 3 stocks she likes right now
▼ + stars: | 2023-05-03 | by ( Marley Jay | ) www.businessinsider.com time to read: +4 min

The firm is known for growth investing, but she says she's picking defensive, stable winners. Mileva told Insider about some of the industries and stocks she likes the most today. How is a company that's known for board games and fantasy figurines anything like a company that owns world famous luxury brands with products like high fashion accessories, champagne, and yachts? That's the view of Milena Mileva, the manager of Baillie Gifford's $564 million Developed EAFE All Cap fund, and an expert on international stocks. These are the ones that historically have been the most successful examples," she told Insider in a recent interview.

☆ Investors see big Novo Nordisk stock boost if obesity drug shows heart benefit
▼ + stars: | 2023-05-03 | by ( Maggie Fick | ) www.reuters.com time to read: +5 min

Demand for the Danish company's weight-loss treatment Wegovy is soaring in the United States, leading it to significantly raise its full-year profit and sales expectations last month. "But most insurance companies (...) may need to see that data, to definitively see the correlation between weight loss and improved outcomes." Less than 15% could put downward pressure on the stock while around 10% would be a major disappointment, some of the investors and analysts said. Booming demand and production issues have caused shortages of Wegovy though, forcing Novo to delay launching the weekly injection in most of Europe. Even with the medical benefit, investors say the company faces a challenge convincing Europe's cost-conscious health authorities to pay for the drug.

Shares of the company hit a six-month low of $190.30 during trading hours after Estee Lauder slashed its fiscal-year forecasts for a third time. Estee expects full-year 2023 net sales to fall between 10% and 12%, compared with its prior forecast of a 5% to 7% decrease. Even though China relaxed pandemic-related restrictions, the company saw January 2023 pressured by retailers destocking due to an increase in COVID-19 cases. Estee has also been challenged by the growth of smaller competitors in the beauty space, according to Travis. Estee forecast adjusted per-share profit to fall by 50% to 51%, compared with a 27% to 29% decrease it expected earlier.

☆ Ending the retailers’ crisis has a high price tag
▼ + stars: | 2023-05-02 | by ( Aimee Donnellan | ) www.reuters.com time to read: +5 min

BARCELONA, May 2 (Reuters Breakingviews) - High-street retailers are facing a heavy bill to weather the cost-of-living crisis. The cost of heating stores and staff requests for pay rises are squeezing operating margins at top players like H&M (HMb.ST) and Next (NXT.L). Shrinking disposable income is making it hard for these retailers to boost sales to protect margins. Most bricks-and-mortar retailers trade on higher multiples than they did before the war in Ukraine sparked soaring inflation. But that leaves a squeezed middle of retailers like H&M exposed to the brunt of the retail crisis.

☆ Slowing growth will crash European stock party
▼ + stars: | 2023-05-02 | by ( Francesco Guerrera | ) www.reuters.com time to read: +6 min

LONDON, May 2 (Reuters Breakingviews) - European shares have been on the rise for seven months, outshining their U.S. counterparts, and are now just 6% below their record high. Luck played a part in the recent European surge. Natural gas prices have fallen more than 80% since their August peak, boosting economic growth and reducing companies’ costs. Analysts currently expect a 0.4% fall in European companies’ earnings per share (EPS) in 2023, according to Barclays. European investors have had an unusually enjoyable, and profitable, ride.

☆ Elon Musk earned a spot at the Museum of Failure, which listed 14 reasons including the strange names he gave 2 of his kids
▼ + stars: | 2023-05-01 | by ( Sam Tabahriti | ) www.businessinsider.com time to read: +3 min

Elon Musk earned a spot at the Museum of Failure in Brooklyn, which listed 14 reasons. According to the Museum of Failure, there's no such thing as innovation without a few bumps along the way. That's something Elon Musk is familiar with, and has earned him a spot at the museum for 14 reasons, which include the unusual names he gave two of his kids: X AE A-XII and Exa Dark Sideræl, who also now goes by Y. The museum aims to stimulate productive discussion about failure and inspire us to take meaningful risks," it says on its website. The museum is in Brooklyn until June 18 and has previously been on display in cities including Calgary, Canada and Taipei, Taiwan.

☆ France pension protests explained: France is still mad -- but can the protests last?
▼ + stars: | 2023-05-01 | by ( Joseph Ataman | ) edition.cnn.com time to read: +7 min

In 1995, weeks-long mass protests forced the government of the day to abandon plans to reform public sector pensions. For many in France, the pensions system, as with social support more generally, is viewed as the bedrock of the state’s responsibilities and relationship with its citizens. Nathan Laine/Bloomberg/Getty ImagesIn contrast, during the Yellow Vest protests, started in opposition to hikes in fuel prices, violence gradually soured public support. That these pensions protests continue to hold such popular goodwill is an ominous sign for Macron’s future plans. The size and violence of pensions protests spiked when Macron forced the legislation past the country’s lower legislative house without a vote.

☆ Forget the pension protests. France’s economy has momentum
▼ + stars: | 2023-04-30 | by ( Anna Cooban | ) edition.cnn.com time to read: +8 min

France’s economy grew 0.2% in the first quarter of this year, its national statistics agency said Friday, after stagnating in the previous quarter. Yet the long-running protests are unlikely to leave a lasting dent in France’s economy, according to Charlotte de Montpellier, a senior economist at Dutch bank ING. But its $2.8 trillion economy has held up comparatively well. Office buildings illuminated in the La Defense business district of Paris, France, on Monday, Feb. 6, 2023. ‘Momentum’ building for banksBritain’s exit from the European Union has also been a boon for France’s financial sector.

☆ Bernard Arnault, the world's richest person, was nicknamed the 'wolf in cashmere' by rivals because of his predatory takeover moves. His company just hit a $500 billion valuation.
▼ + stars: | 2023-04-29 | by ( Mary Hanbury | ) www.businessinsider.com time to read: +4 min

Bernard Arnault is head of luxury giant LVMH and the world's richest person worth $206 billion. He earned the nickname the "wolf in cashmere" because of his ruthless moves to acquire rivals. It's enabled him to create the world's largest luxury conglomerate, which was valued at $500 billion this week. "Arnault is a man of great vision," Pierre Mallevays, former head of acquisitions at LVMH, previously told The Guardian. It was during his pursuit of Hermès International that he earned the nickname of the "wolf in cashmere."

☆ Louis Vuitton dazzles luxury-seeking Seoul with first pre-fall show
▼ + stars: | 2023-04-29 | by ( ) www.reuters.com time to read: +1 min

SEOUL, April 29 (Reuters) - LVMH's (LVMH.PA) top fashion brand Louis Vuitton held its first-ever pre-fall fashion show on Saturday on a bridge in Seoul, the capital of a leading luxury market. In one of the highest profile events since chairman and CEO Pietro Beccari started at Louis Vuitton earlier this year, the runway on the lower level of the double-decker Jamsu bridge that spans the Han River was bathed in blue shadows. Models walked the 795 metre (2,608 feet) bridge, where traffic was stopped for 24 hours, wearing fitted, sporty designs with geometric patterns designed by Nicolas Ghesquière, artistic director of women’s collections at Louis Vuitton. They strode out of a tunnel on chunky-heeled shoes in slick windbreakers, miniskirts that flared out and striped suits. On Saturday the creator and director of 2021's Netflix hit drama "Squid Game" Hwang Dong-hyuk participated in the show scenography.

☆ Major Wall Street firm sees a breakout in luxury stocks — and lists three reasons why ETFs are a great way to play it
▼ + stars: | 2023-04-29 | by ( Sean Conlon | ) www.cnbc.com time to read: +1 min

As luxury stocks make waves overseas, State Street Global Advisors believes investors should consider European ETFs if they want to capture the gains from their outperformance. Bartolini lists price momentum as a third driver of the investor shift. His SPDR Euro Stoxx 50 ETF (FEZ) is considered a broad European ETF. While the fund's top holding is LVMH at 7.29%, according to the company's website, Bartolini contends the shift applies beyond luxury stocks and to lower-end consumer stocks. His firm's website lists French cosmetics company L'Oreal — which is up almost 30% this year — as another one of his fund's major holdings.

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