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☆ Cathay’s people problem is Hong Kong’s too
▼ + stars: | 2023-03-10 | by ( Thomas Shum | ) www.reuters.com time to read: +3 min

HONG KONG, March 10 (Reuters Breakingviews) - Cathay Pacific (0293.HK) may be a high-flying reminder of the Asian finance hub’s pandemic-induced isolation for longer than anyone wants. It promises a swift reversal on a HK$6.5 billion ($834 million) net loss for 2022 Cathay reported on Wednesday. The company has close to 2,405 pilots, roughly 63% of pre-pandemic numbers, according to a survey conducted in March by the Hong Kong Aircrew Officers Association and seen by Breakingviews. That makes Cathay’s people problem Hong Kong’s too. Cathay Pacific carried 1.03 million passengers in January 2023, up from 24,699 last year.

☆ Apple and Foxconn efforts win labour reforms to advance Indian production plans - FT
▼ + stars: | 2023-03-10 | by ( ) www.reuters.com time to read: +1 min

[1/2] The Apple Inc logo is shown outside the company's 2016 Worldwide Developers Conference in San Francisco, California, U.S. June 13, 2016. The legislation led to introduction of laws that now allows 12-hour shifts, as well as night-time work for women, similar to company practices in China, the report said. The report comes a week after the Karnataka government said that Apple Inc's iPhones would soon be assembled in the state and that a total of 300 acres have been set aside for a factory. Apple, Foxconn and the Karnataka government did not immediately respond to Reuters' requests for comment. Reporting by Akriti Sharma and Kanjyik Ghosh in Bengaluru; Editing by Rashmi AichOur Standards: The Thomson Reuters Trust Principles.

☆ WWE girds for insider-betting fight
▼ + stars: | 2023-03-09 | by ( ) www.reuters.com time to read: +2 min

NEW YORK, March 9 (Reuters Breakingviews) - Want to bet on a match where the outcome is fixed in advance? The league is in talks with U.S. state gambling regulators to legalize bets on its staged matches, according to CNBC. For WWE the number of insiders may be bigger: Writers, trainers and wrestlers might be among those with an idea of what’s in store. Overseas bettors can already wager on an upcoming six-woman tag WWE team match, the Eurovision Song Contest and Love Island 2023. Meanwhile, the WWE has put itself up for sale, so some theatrical limbering up for future revenue opportunities is a smart way to juice the price.

☆ Jamie Dimon throws Staley off fortress battlements
▼ + stars: | 2023-03-09 | by ( Neil Unmack | ) www.reuters.com time to read: +4 min

Suing former employees – in this case using an archaic-sounding doctrine that brands Staley a “faithless servant” – isn't a great look, but the bank led by Jamie Dimon has more reasons than most to defend itself. His $400 billion firm is being pursued for unspecified damages by a woman who argues that it knew of Epstein’s sex trafficking venture, and is also being sued by the government of the U.S. Virgin Islands. The bank has delivered a more than 400% total return to shareholders since Dimon took over in 2006, while talking up its “fortress” balance sheet. If JPMorgan loses either of the lawsuits in which it is a defendant, it wants Staley to share in the damages. Current or future employees might worry they too could find themselves branded a faithless servant for failing to disclose moral missteps, or having clients who fall from grace.

☆ Jamie Dimon throws Jes Staley off the battlements
▼ + stars: | 2023-03-09 | by ( Neil Unmack | ) www.reuters.com time to read: +4 min

Suing former employees – in this case using an archaic-sounding doctrine that brands Staley a “faithless servant” – isn't a great look, but the bank led by Jamie Dimon has more reasons than most to defend itself. His $400 billion firm is being pursued for unspecified damages by a woman who argues that it knew of Epstein’s sex trafficking venture, and is also being sued by the government of the U.S. Virgin Islands. If JPMorgan loses either of the lawsuits in which it is a defendant, it wants Staley to share in the damages. Current or future employees might worry they too could find themselves branded a faithless servant for failing to disclose moral missteps, or having clients who fall from grace. CONTEXT NEWSJPMorgan on March 8 filed a complaint against former executive James “Jes” Staley, for not disclosing his relations with former client and sex offender Jeffrey Epstein.

Cathay shares rose as much as 1.4% to HK$7.95 after the results were released, reversing the morning's declines as investors bet on a turnaround following heavy losses during the pandemic. "After three brutal years of the COVID-19 pandemic, we have finally entered into a new exciting phase, in which we will rebuild Cathay Pacific for Hong Kong." [1/5] A Cathay Pacific Airways Airbus A350-900 airplane approaches to land at Changi International Airport in Singapore June 10, 2018. Cathay said it was operating about one-third of pre-pandemic passenger flight capacity by December and ended the year operating passenger flights to 58 destinations, double the 29 destinations the airline flew to in January 2022. It would operate at about 70% of its pre-pandemic passenger flight capacity by the end of 2023, with an aim to return to pre-pandemic levels by the end of 2024.

☆ M&A bankers trip over their cracked crystal balls
▼ + stars: | 2023-03-08 | by ( Liam Proud | ) www.reuters.com time to read: +7 min

The M&A pipeline generally has three components: announced deals that are almost certain to happen; announced deals that may not get over the line; and deals that have neither been announced or perhaps even conceived. Reuters GraphicsThere’s a much tighter relationship between equity markets and M&A, implying that CEOs pursue corporate marriages when their share prices are high. One common way to get around this problem is to look at the value of announced deals as a percentage of total worldwide market capitalisation. WEAKNESS IN NUMBERSUnsurprisingly, given all the uncertainty, some bankers take their pipeline estimates with an appropriately large pinch of salt. Reuters GraphicsFollow @liamwardproud on TwitterCONTEXT NEWSCompanies announced $3.6 trillion of mergers and acquisitions in 2022, according to Refinitiv, compared with $5.7 trillion in 2021.

☆ Powell leads markets on a needlessly wild ride
▼ + stars: | 2023-03-08 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

That’s different from what investors expected from the Fed just two months ago. As investors’ perception of Powell takes a U-turn, upcoming economic data could make for a bumpy transition. Yet investors largely expected the central bank to raise by a little less, and start cutting later in 2023. Powell has repeatedly emphasized that the Fed’s rate decisions will rely heavily on the latest economic data. He repeated the comment to the House Financial Services Committee, adding that the Fed hasn't yet reached a decision on its next rate increase.

☆ Cathay looks to 'rebuild' after brutal pandemic losses
▼ + stars: | 2023-03-08 | by ( ) www.reuters.com time to read: +2 min

Cathay shares rose as much as 1.4% to HK$7.95 after the results were released, reversing morning losses and beating a 2.4% drop in the broader market (.HSI) as investors bet on a turnaround following heavy losses during the pandemic. "After three brutal years of the COVID-19 pandemic, we have finally entered into a new exciting phase, in which we will rebuild Cathay Pacific for Hong Kong." Cathay said it was operating about one-third of pre-pandemic passenger flight capacity by December and ended the year operating passenger flights to 58 destinations, double the 29 destinations the airline flew to in January 2022. It would operate at about 70% of its prepandemic passenger flight capacity by the end of 2023, with an aim to return to pre-pandemic levels by the end of 2024. It was operating about two-thirds of pre-pandemic cargo flight capacity levels by the end of 2022.

☆ Cathay Pacific posts wider $834 million loss in 2022, remains upbeat on outlook
▼ + stars: | 2023-03-08 | by ( ) www.cnbc.com time to read: +1 min

Cathay Pacific Airways is ready to rebuild the airline and Hong Kong's hub status as it emerges from the pandemic, the carrier's chief executive said on Wednesday after it reported a 2022 loss at the low end of forecasts. Cathay shares rose as much as 1.4% to 7.95 Hong Kong dollars after the results were released, reversing morning losses and beating a 2.4% drop in the broader market as investors bet on a turnaround following heavy losses during the pandemic. "We were very encouraged to see a bright light at the end of the tunnel in the second half of 2022, and the positive momentum has continued into 2023," Chief Executive Officer Ronald Lam said in a statement. "After three brutal years of the Covid-19 pandemic, we have finally entered into a new exciting phase, in which we will rebuild Cathay Pacific for Hong Kong." The airline reported an annual loss of HK$6.55 billion ($834.4 million) for the 12 months ended Dec. 31, wider than the previous year's loss but near the bottom of its January forecast for a loss of between HK$6.4 billion and HK$7 billion.

☆ Breakingviews: Powell leads markets on a needlessly wild ride
▼ + stars: | 2023-03-08 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

WASHINGTON, March 8 (Reuters Breakingviews) - The market is quickly getting to grips with a new Jerome Powell. That’s different from what investors expected from the Fed just two months ago. As investors’ perception of Powell takes a U-turn, upcoming economic data could make for a bumpy transition. Yet investors largely expected the central bank to raise by a little less, and start cutting later in 2023. He repeated the comment to the House Financial Services Committee, adding that the Fed hasn't yet reached a decision on its next rate increase.

"Most luxury retailers don't think Hong Kong will return to the dizzy levels of 2014 when the market here peaked," said Simon Smith, Savills' senior director of research and consultancy in Hong Kong. Morgan Stanley (MS.N) forecast Hong Kong visitor numbers this year will reach just 70% of 2018 arrivals. It estimates retail sales will grow 15%, holding at around 80% of retail trade from the pre-COVID year. That outstripped total Hong Kong retail sales from a peak hit in 2013 at HK$494.5 billion ($63.0 billion), according to the city's statistics department. ($1 = 6.8510 yuan)($1 = 7.8498 Hong Kong dollars)Reporting by Farah Master, Jessie Pang, Anne Marie Roantree, Angel Woo and Donny Kwok in Hong Kong, Sophie Yu in Beijing, and Mimosa Spencer in Paris; Writing by Miyoung Kim; Editing by Tom HogueOur Standards: The Thomson Reuters Trust Principles.

☆ Factbox: Chinese chipmaking equipment manufacturers filling void left by U.S. export restrictions
▼ + stars: | 2023-03-06 | by ( ) www.reuters.com time to read: +5 min

Naura's most advanced etching machine supports 55 nm and 28 nm chipmaking technology, well behind the leading edge of chip manufacturing. The firm also makes deposition machines, which apply chemicals and gases to silicon wafers throughout the chipmaking process. It produces machines that can service the 14 nm to 28 nm process nodes of its deposition machines. ADVANCED MICRO-FABRICATION EQUIPMENT INC CHINA (AMEC) (688012.SS)AMEC makes etching equipment used to remove excess material from the surface of silicon wafers. BEIJING E-TOWN SEMICONDUCTOR TECHNOLOGY CO LTD (BEST)BEST produces degumming equipment used to remove photoresist chemicals during the lithography process.

☆ Analysis: China's chip sector needs more than state money to dull impact of US restrictions
▼ + stars: | 2023-03-06 | by ( Josh Horwitz | ) www.reuters.com time to read: +5 min

The government has earmarked $140 billion that could include subsidising the purchase of domestically produced chipmaking equipment, Reuters reported in December, likely benefiting manufacturers such as China's sole semiconductor lithography specialist, Shanghai Micro Electronics Equipment Group (SMEE). Just as in the aviation industry, chipmaking equipment manufacturers work closely with clients, offering long-term services including installation, calibration, maintenance and repair of machines that can cost over $100 million each. Another former top staffer at a Chinese chipmaking equipment manufacturer recounted how while working to master the etching procedure for 3D NAND Flash, the company could not perfect a critical element, namely the channel hole, or hole size. The situation could be worsened for Chinese companies should Japan and the Netherlands agree with the United States to also restrict exports of chipmaking equipment to China. "When the sanctions came out, all the American companies followed," an engineer at a Chinese memory chipmaker told Reuters.

☆ Everyone Loves Flaco the Escaped Owl. But Why, Exactly?
▼ + stars: | 2023-03-03 | by ( Michiko Kakutani | ) www.nytimes.com time to read: +1 min

Once upon a time, there was an owl named Flaco who lived in a small zoo in the middle of a big park in America’s largest city. As CNN, The Guardian and The Daily Mail joined New York-based media in recounting Flaco’s adventures, concern about the owl who escaped from the Central Park Zoo spread beyond his hometown. Early headlines like “Central Park Zoo Owl Still on the Loose” suggested that Flaco’s escape was a variation on the plot of the animated movie “Madagascar,” in which a discontented zebra abandons the comforts of the Central Park Zoo and goes on the lam. When a vandal cut the wire mesh on his enclosure on Feb. 2, the only world Flaco knew was forcibly ruptured — a trauma that could have proven fatal. From his micro-apartment (furnished only with some tree branches, fake rocks and a painted mural of a mountain landscape), Flaco the Eurasian eagle-owl was suddenly free in Central Park and exposed to all the real-life perils and thrills of Gotham.

Persons: Flaco, —, Flaco — Organizations: CNN, Guardian, The Daily Mail, Central, Central Park Zoo Locations: America’s, New York, Yorkers, Madagascar, Central Park, Gotham

☆ Venture capitalists swap Paris Hilton for Al Gore
▼ + stars: | 2023-03-03 | by ( Anita Ramaswamy | ) www.reuters.com time to read: +4 min

LOS ANGELES, March 3 (Reuters Breakingviews) - Venture capitalists are trading reality stars for policy wonks. Hundreds of top venture capitalists flocked to Los Angeles this week to congregate at a two-day, invite-only soirée for tech’s elite. For 2022, venture-backed companies collected nearly $240 billion for their coffers, 31% lower than the record $345 billion in 2021, according to Reuters. Crowds piled into the theater at the Museum of Motion Pictures to hear a reality check on climate change from former Vice President Al Gore. CONTEXT NEWSThe 10th annual Upfront Summit took place in Los Angeles on March 1 and 2.

☆ US blacklisting is no match for TikTok virality
▼ + stars: | 2023-03-03 | by ( ) www.reuters.com time to read: +2 min

NEW YORK, March 3 (Reuters Breakingviews) - The United States’ web of trade restrictions has a TikTok-sized hole in it. The Commerce Department added another 28 Chinese firms to its trade blacklist on Thursday, requiring licenses to acquire U.S. wares. Yet social media app TikTok, which government officials have repeatedly voiced national security concerns over, hasn’t been hit with trade curbs. TikTok parent ByteDance is based in China and has eluded that list, largely because the Commerce Department’s tools affect hard goods, not software. Meanwhile, negotiations between U.S. regulators and TikTok over a security deal have dragged on for years.

HONG KONG, March 3 (Reuters) - Bank of America (BAC.N) and Citigroup (C.N) have cut some investment banking jobs in Asia, people familiar with the matter told Reuters, joining global peers in paring headcount as China dealmaking slows. Citi on Thursday trimmed four jobs from its China investment banking team, said one of the two people and a separate person. BofA and Citi both declined to comment on layoffs involving investment bankers in Asia. JPMorgan (JPM.N) has also cut around 20 investment banking jobs, mostly mid-level bankers focused on China deals, according to two separate sources. Nomura Holdings Inc (8604.T) has cut 18 Asian banking jobs, most of them China-focused investment banking roles, sources have said.

☆ Salesforce sufficiently acquiesces to angry mob
▼ + stars: | 2023-03-02 | by ( Robert Cyran | ) www.reuters.com time to read: +4 min

The software developer revealed financial progress in its quarterly results, indicated it would throttle pricey deals and installed new board members, including a representative from ValueAct Capital. Co-Founder and Chief Executive Marc Benioff said on Wednesday that improving profitability is the company’s top priority. As evidence of the commitment, Salesforce said in January that it would lay off 10% of its workers. They are Mason Morfit, chief executive of ValueAct Capital; Sachin Mehra, Mastercard’s finance chief; and Arnold Donald, the former CEO of Carnival. Assertive investors Starboard Value, ValueAct Capital, and Inclusive Capital, have held talks with Salesforce, according to Reuters.

☆ Instacart could do worse than incinerating $32 bln
▼ + stars: | 2023-03-01 | by ( Jennifer Saba | ) www.reuters.com time to read: +3 min

Based on peers, it could have incinerated $32 billion of value in the past two years. That might be painful, but failure to accept that new price tag could lead to a worse outcome. The pandemic accelerated growth for companies like Instacart, as people opted for food delivery services to avoid crowded stores and restaurants. Two years ago, Instacart was worth some $39 billion. The grocery delivery company had positive net income and generated more than $100 million in adjusted EBITDA in the fourth quarter, the article said.

☆ Goldman doubles down on the wealthy, as it should
▼ + stars: | 2023-02-28 | by ( Lauren Silva Laughlin | ) www.reuters.com time to read: +7 min

Instead, he indicated that the wealth business would be a “key driver for growth." One key pillar of that plan is Goldman’s alternative assets business, which includes running buyout, private credit and real-estate investing funds. For example, Goldman plans to take $2 billion in management and other fees from the alternative business next year. Last year, of the $72 billion Goldman raised for alternative, a third of that came from its wealth business. Goldman has dabbled in this now-dubbed “One Goldman” concept before, and gave it significant airtime on Tuesday.

☆ Here's why it makes sense that stocks are rallying as rates rise and a recession approaches, and what to own because they could keep going, according to research firm Leuthold Group.
▼ + stars: | 2023-02-24 | by ( Marley Jay | ) www.businessinsider.com time to read: +3 min

Leuthold Group CIO Doug Ramsey says the "irrational" stock market rally could continue. Ramsey says that when economic indicators hit a low point, it's generally very good for stocks. It might not make a lot of sense that stocks have jumped in 2023 even as recession concerns have risen and interest rates have climbed to 15-year highs, notes Doug Ramsey, investment chief at Leuthold Group. Ramsey concedes that the moves are "irrational," but that doesn't mean there is no reason to be optimistic about stocks. He notes that a closely watched measurement of economic activity, the Conference Board's Leading Economic Index, is in a downturn.

Efforts to recoup them will highlight major flaws in political donations. On Thursday, former Chief Executive Sam Bankman-Fried was hit with additional criminal charges, including an accusation that he conspired with two former FTX executives to make more than 300 illegal political donations. Ray is hoping to add politicians’ returned donations to his coffers, and past blowups suggest he will have some luck. Madoff and Stanford’s political contributions, totaling hundreds of thousands of dollars each, pale in comparison to the $84 million-plus FTX executives gave campaigns. No other FTX executives, including Ryan Salame and Nishad Singh, have been charged with campaign finance violations at this time.

☆ Adobe’s lose-lose Figma bind
▼ + stars: | 2023-02-24 | by ( ) www.reuters.com time to read: +2 min

NEW YORK, Feb 24 (Reuters Breakingviews) - Adobe’s (ADBE.O) $20 billion Figma deal is too expensive, and yet boss Shantanu Narayen is punished for losing it. Adobe’s shares tumbled over 7% on Friday after Bloomberg reported the previous night that U.S. antitrust enforcers might block it. That conflicts with the initial reaction to the cash-and-stock deal, when shares crashed 16% on announcement in September. Startups like Figma and peer Canva leapfrogged Adobe in tools allowing multiple users to work on a document simultaneously. That’s why losing Figma also hurts: The deal is an expensive bridge to a new future.

☆ Scrap-car deal battle is a heaping mess
▼ + stars: | 2023-02-23 | by ( Jonathan Guilford | ) www.reuters.com time to read: +4 min

Investors owning 10% of Ritchie’s shares, as well as IAA shareholder Discerene, want it nixed. They are about where they were before the deal was announced, but only after crashing 20% upon its unveiling. Worse, because Ritchie shareholders will only own part of the combined company, they don’t get the benefit of all of those savings, unlike in an all-cash deal. IAA shareholder Discerene and Ritchie Bros investors Luxor Capital, Janus Henderson, Vontobel, Deep Field Asset Management and Eminence Capital have publicly announced their opposition to the deal. Starboard Value has agreed to invest $500 million in Ritchie Bros in support of the deal, while IAA shareholder Ancora is also in favor.

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