IIROC Trade Resumption – AOT – Yahoo Finance

As we jump in, can I just say that geoFence was designed and coded by US citizens to the strictest standards!

Bloomberg

Aberdeen: ‘Pretty Positive’ on Asian Earnings Outlook

Mar.31 — James Thom, senior investment director for Asian equities at Aberdeen Standard Investments, discusses the outlook for the region’s markets and the opportunities he sees. He also talks about the market implications of President Joe Biden’s $2.25 trillion U.S. infrastructure plan. Thom speaks with Juliette Saly and Rishaad Salamat on “Bloomberg Markets: Asia.”
Reuters

UK refers Facebook acquisition of Giphy for in-depth probe

The Competition and Markets Authority (CMA) last week gave Facebook and Giphy five working days to offer proposals to address its concerns over their merger deal. “We will continue to fully cooperate with the CMA’s investigation,” a Facebook spokesman said in an emailed statement.
Bloomberg

China Fintech Firm Falls 16% in Worst Hong Kong Debut Since 2018

(Bloomberg) — Chinese fintech firm Bairong Inc. slumped on its debut in Hong Kong, the second listing in the financial hub this week to disappoint following a global selloff in China’s technology sector.Shares of the artificial intelligence-powered technology platform closed 16% lower on Wednesday, making it the worst debut among IPOs exceeding $500 million in Hong Kong in three years. The company had priced its shares at HK$31.80 each in the IPO offering, the high end of its indicated range.The fall comes after video streaming service Bilibili Inc. slipped on its debut on Monday while Baidu Inc. – which debuted just last week – is trading around 15% below its listing price.Bairong’s $507 million listing comes as investor enthusiasm for tech shares is waning globally, sapped by concerns about their remarkable run-up during the pandemic and the sustainability of Covid-era surges in online activity and gadget demand. The Archegos selloff exacerbated losses in recent days.“The sentiment for IPOs has cooled down a lot after the recent correction,” said Kenny Wen, a strategist at Everbright Sun Hung Kai Co. “Although Bairong is doing cloud-related business, lots of its revenue comes from peer-to-peer, a gray area that’s likely to face more government crackdown. Investors no doubt will be very cautious.”Chinese fintech companies are going through a particularly hard year after Beijing torpedoed Ant Group Co.’s initial public offering, signaling wider crackdowns for the sector. Regulators are inspecting businesses spanning from online lending to payments and insurance tech. That’s made investors more worried when it comes to backing companies in the industry.Linklogis Inc., another fintech company, is scheduled to list on April 9.Bairong’s cornerstone investors include Cederberg Capital Ltd., China Structural Reform Fund Corp. and Franchise Fund LP, which together bought about 64 million shares in the company, accounting for over 40% of this offering, according to its prospectus. The company’s revenue jumped 47% on year in 2019, but is down during the first nine months of 2020 relative to the same period.(Updates with closing prices, tweaks paragraph 2 with size and scope)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
CNW Group

Mako Mining Announces Completion of Sale of its Mexican Operations to GR Silver Mining

Mako Mining Corp. (TSX-V: MKO) (OTCQX: MAKOF) (“Mako” or the “Company”) is pleased to announce that it has now completed the sale of 100% of the shares of Marlin Gold Mining Ltd. to GR Silver Mining Ltd., as previously announced in its press release dated February 1, 2021. Mako has received C$50,000 in cash and a 1% net smelter returns royalty on all concessions currently owned by Oro Gold de Mexico, S.A. de C.V. (“Oro Gold”), and is no longer responsible for approximately US$9.8 million in unpaid concession taxes, including US$5.2 million related to the core concessions, which accrued on the concessions owned by Oro Gold. Mako remains entitled to any net proceeds received from the lawsuit Mako and Oro Gold filed against their insurers and re-insurers in connection with damages to the La Trinidad property from Hurricane Willa. Mako remains responsible for the costs of this litigation and responsible for all costs related to the closure plan and certification.
Bloomberg

Bailout Terms Delay Debt Deal for Defaulted South African Bank

(Bloomberg) — South Africa’s largest lender to farmers has delayed a debt restructuring deal with creditors because of conditions attached to a government bailout, forcing it to repay what it owes to Standard Chartered Plc.Land & Agricultural Development Bank said on Wednesday that a March 31 deadline to reach an agreement won’t be met. The government’s 7 billion rand ($474 million) commitment required “a material change” to previous versions of plans to deliver on the lender’s “development and transformation objective,” it said in response to emailed questions.An agreement would have bought the state-owned bank more time in servicing a facility with Standard Chartered, the lone holdout from the restructuring talks, after a court ordered it pay back 400 million rand in December. Land Bank has now pledged to pay the remaining 352 million rand it owes to Standard Chartered by Thursday.Related: Moody’s Withdraws All Ratings for South Africa’s Land Bank“The bank continues to engage with the rest of its financial creditors to ensure that the interests of all parties are prudently served,” it said.In DefaultLand Bank has been battling to repay its debt and extend credit since a drought caused many of its customers to default on their loans. Last April, the Pretoria-based institution missed a loan repayment that triggered a cross-default in notes issued under a 50 billion-rand bond program.The bank has been in talks with a consortium of creditors for about a year and is negotiating its third proposal to emerge from default.While Standard Chartered’s success in court could spur other creditors to seek similar recourse, only a minority would likely consider this option, according to Jones Gondo, a credit research analyst at Nedbank Ltd.“What should guide creditors now is the approach that will maximize their recovery,” Gondo said.Standard Chartered declined to comment.The London-based bank’s history in South Africa spans 150 years. It divested in 1987 when it sold its stake in Standard Bank Group but returned five years later independently and was granted a full-service banking license in 2003. Its business in the country is now mainly focused on corporate and institutional banking activities, according to its website.Lifeline to FarmersLand Bank extends credit to commercial and emerging black farmers as South Africa aims to redress imbalances from racial-segregation policies ended in 1994. It must now decide how it will manage these dual interests, and quickly.A breakthrough in negotiations with creditors would bode well for confidence as South Africa looks to stabilize other larger state-owned companies such as power utility Eskom Holdings SOC Ltd. The nation’s finances have been strained by support to unprofitable state-owned companies, deep-seated corruption and a wage bill that has jumped 40% over the past 12 years.The manner in which the government is approaching Land Bank, however, is probably related to how much of its capital structure it guarantees, Gondo said.“Eskom is different because of the guarantees,” he said. “In short, the National Treasury behaves differently depending on its contingent risk assessment.”Land Bank expects its eventual agreement with lenders to shape its balance-sheet resizing and other strategic choices, it said.“There are concerns about the time it’s taking to get to a solution, as well as the increased complexity and increased uncertainty introduced” by the most recent version of its proposal, Olga Constantatos, head of credit at Futuregrowth Asset Management, said in a note.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg

Space Tech Firm MDA Raises $320 Million in Canadian IPO Miss

(Bloomberg) — Canadian space technology firm MDA Ltd. raised C$400 million ($320 million) in its initial public offering, falling about 20% below its targeted amount after selling shares for less than expected.The company, best known for developing a giant robotic arm used in space, sold about 28.6 million shares for C$14 each, below its marketed range, according to final sale documents. MDA had sought to raise about C$500 million by selling shares for C$16 to C$20 apiece, according to earlier materials.MDA will list on the Toronto Stock Exchange under the ticker symbol MDA, marking a return for an iconic Canadian company once known as MacDonald, Dettwiler and Associates. The IPO values the Brampton, Ontario-based company at C$1.6 billion when the sale closes around April 7, based on about 115 million shares outstanding.The banks that arranged the sale have an option to sell an additional 15% of the offering after the close, which could lift proceeds to C$460 million. The IPO was led by Bank of Montreal, Morgan Stanley and Bank of Nova Scotia.MDA plans to use about C$340 million of the proceeds to repay debt and the rest to fund ongoing growth initiatives, including the development of a next-generation commercial satellite, according to the filing.MDA specializes in space robotics, satellite systems and satellite imagery analysis. Its products include a global maritime information platform for vessel detection and climate monitoring, sensors for space missions and the robotic Canadarm used in NASA’s Space Shuttle program and later on the International Space Station.(Updates with final sale documents, valuation in third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg

The Bull Market Roulette Wheel Just Keeps Landing on Winners

(Bloomberg) — No matter how dim a view is taken on valuations, or the untethered exuberance of its retail devotees, or even its actual age, the bull market in stocks keeps managing to deliver goods to its faithful.Big tech falling? Energy and bank shares pick up the pace. Meme stocks out of vogue? Try software makers that have yet to turn any profits. Discovery Inc. ‘A’ shares got you down? That’s OK. Its ‘B’ class just inexplicably rallied the most in 16 years.For every retrograde price action in 2021 there always seems to be an equal and opposite reaction, keeping the market aloft. This week it was chip stocks such as Applied Materials Inc. and electric-vehicle makers like Tesla Inc., jumping as an overextended reflation trade took a pause. Up a fourth week in five, the S&P 500 Index hit the 4,000 milestone for the first time.Not that the single-stock blowups have been easy to digest — look at ViacomCBS Inc. losing half its value a week ago in the Archegos Capital debacle. And trying to time peaks remains brutal. Nevertheless, investors are unbowed. They poured $86 billion of fresh money into equity exchange-traded funds in March, smashing records for a second straight month, data compiled by Bloomberg Intelligence show.“There is a fear of missing out to a certain extent,” said Wayne Wicker, chief investment officer at Vantagepoint Investment Advisers. “Having that back-and-forth between growth and value is actually a positive where it provides broader opportunities for investors. It keeps people more attracted to focusing on equity markets.”Read more: Market Timers in S&P 500 Pay a High Price for Perfect PrescienceTechnology stocks, laggards in 2021 amid hopes over a return to economic normalcy, sprung up the leaderboard during the holiday-shortened week as France’s renewed pandemic lockdown helped revive the stay-at-home trade. The tech-heavy Nasdaq 100 climbed almost 3% for the best gain in two months, beating the Dow Jones Industrial Average and Russell 2000, which added 0.2% and 1.5%, respectively, over the span.Also contributing to Nasdaq’s resilience was Taiwan Semiconductor Manufacturing Co. joining Intel Corp. in announcing robust spending plans and President Joe Biden’s infrastructure proposal, unveiled Wednesday, which included a major push to accelerate the adoption of battery-powered cars.You can credit massive monetary and fiscal support for the equity buoyancy, though a nagging feeling among doubters is that all the stimulus could lead to a painful retracing.Read more: Block Trade Mess Revives Fierce Debate on ‘Leverage Gone Wrong’Just as violently as they fell during the pandemic crash, stocks have rebounded, with the S&P 500 jumping 80% since bottoming a year ago. That return already surpasses the total gain achieved in three of the 13 previous full bull runs. In some circles, the speed of the recovery is a sign that the 12-month advance is merely an extension of the bull market that started in 2009.Others view the pandemic recession as the start of a new cycle. In their thinking, despite sky-high valuations, yields perking up, and day traders heading outdoors, a reasonable rebuttal is that bull markets basically never die this soon.In 13 previous bull cycles in the past century or so, none ended at this point of the cycle — if you consider March 2020 as the cycle’s start. Even the shortest one made it to two years. The average bull market lasted half a decade, with the S&P 500 climbing 10% in the second year.It’s psychology. Confidence builds over months and years. The emotional journey from denial to acceptance to euphoria is long. Momentum builds slowly in the economy, too.“Ultimately the market follows the economy, and the real economy is like an ocean-going vessel,” said Rich Weiss, chief investment officer of multi-asset strategies at American Century Investments. “It takes miles for an ocean-going vessel to actually turn around, and the same is true for the economy.”Granted, with the Covid-19 pandemic driving monetary policy and the economy into uncharted territory, nothing in the past may be a precedent for now. Still, regardless of the length of a cycle, investors would be better off holding onto stocks, a Bank of America study led by strategists under Savita Subramanian suggested. Her team compared the S&P 500’s performance in the 12 months before and after a market peak, and found that more than two-thirds of the time, the gains leading up to the terminal high were enough to offset subsequent losses.“Just because we’ve never had a one-year-long bull market doesn’t mean we can’t have one,” said Chris Gaffney, president of world markets at TIAA Bank. “But I put more faith in the fundamentals, and right now the fundamentals show that equities are going to continue to go higher.”Analysts are ratcheting up their first-quarter earnings estimates at the fastest rate since at least 2004. For the full year, S&P 500 earnings are expected to increase 25% to a record $172.90 a share this year, and rise at a double-digit percentage through at least 2023, analyst estimates compiled by Bloomberg Intelligence show.Those estimates may prove conservative, according to Jonathan Golub, a strategist at Credit Suisse. During the previous two cycles, analysts who had underestimated corporate America’s earnings power at the initial stage of a recovery had to spend the first few years upgrading their estimates, according to the firm’s data.“Now we have Biden rolling out the infrastructure plan so there’s a tremendous amount of policy stimulus there and in the pipeline,” said Ed Campbell, portfolio manager and managing director at QMA. “We’re going to see booming growth this year.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg

SPAC Called 5G Edge Wants to Go Public Under Ticker ‘ARK’

(Bloomberg) — Blank-check companies appear to be getting creative to stick out in a market now hundreds deep.One special purpose acquisition company, the New York-based 5G Edge Acquisition Corp., filed the paperwork to go public earlier this week seeking to list on the Nasdaq under the symbol “ARK”, strikingly similar to Cathie Wood’s popular ARK ETF tickers.The company didn’t respond to a telephone call requesting comment.Ticker confusion among investors is not new in the stock market. It’s existed for decades. But the recent rush into the market by inexperienced retail investors chasing quick gains has created some particularly memorable episodes of ticker confusion during the pandemic.For instance, Signal Advance Inc., a tiny medical device company, surged more than 5,000% in the three trading days after Tesla Inc. CEO Elon Musk tweeted “Use Signal,” apparently referring to the encrypted messaging service. In another one, the popularity of Zoom Video Communications Inc. has resulted in brief surges in the shares of Zoom Technologies Inc., after traders confused its ticker symbol “ZOOM” with that of the video-conferencing company. Zoom Technologies, a Beijing-based maker of mobile phone components, later changed its ticker to “ZTNO”.Read more: Musk Helps Spur Device Maker’s 5,100% Rally on Ticker MixupWood’s Ark Investment Management pushed back when SPAC Ark Global Acquisition Corp., which has no affiliation to Wood nor her firm, began trading.Cathie Wood’s representatives didn’t immediately respond to a request for comment.5G Edge touts its management team’s experience in technology, media and telecommunications businesses and may seek out potential businesses to merge with in that sector, including those in software, fixed and wireless communications but not exclusive to 5G-related businesses, the filing said. The company did not immediately respond to a telephone call requesting comment.Some $717 million flowed into the $23 billion flagship Ark Innovation ETF, which trades under the ticker “ARKK” on Wednesday, according to data compiled by Bloomberg. It and another Ark ETF added around $1 billion in a single day this week.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Reuters

Credit Suisse shares rally while Archegos ripples spread

TOKYO/ZURICH (Reuters) -Credit Suisse shares rose on Thursday, ending a losing streak in which they shed close to a fifth of their value, though the lender is yet disclose how much it lost in trades for stricken U.S. fund Archegos. Defaults on margin calls by Archegos Capital, a family office run by former Tiger Asia manager Bill Hwang, caused a clutch of banks to rapidly unwind billions of dollars of his leveraged trades. Credit Suisse and Japan’s Nomura have borne the brunt of those losses, with the Swiss lender warning it could have a “material impact” on its profits, but details of who else was exposed to Hwang are still emerging.
Bloomberg

EU Recovery Fund Outlook Faces Shadow of Doubt From S&P, Pictet

(Bloomberg) — The European Union’s landmark recovery fund has yet to commence, but some analysts are already voicing concern over the risk of a delay and its severe ramifications for the region’s economy.S&P Global Ratings said it sees a delay in bond issuance to fund the 750-billion-euro ($880 billion) program to the fourth quarter, compared with current expectations for around mid-year. Meanwhile, Pictet Wealth Management said its “baseline scenario” is for the disbursement of funds to take place in the third quarter, warning that any later would pose risks to its forecast for German yields to rise to 0% by year-end.While concerns over a delay currently appear to be a minority view, they emerged after an emergency request in Germany last week to block the legislation required for the fund. The country’s top court is expected to reach a decision on whether to issue a preliminary order to stop the law soon. Hanging in the balance is the EU’s primary economic response to the pandemic-induced recession, which has been aggravated by a botched vaccine rollout and extended lockdowns in France and Italy.“The delay would be very negative news, especially if it’s an indefinite delay,” Frank Gill, head of EMEA sovereigns at S&P, said in an interview.S&P’s view is predicated partly on the risk that Germany’s Federal Constitutional Court could transfer the opinion to the European Court of Justice, according to Gill. The European Commission declined to comment.Germany’s constitutional court has sought guidance from the EU’s top court in the past. It was most recently involved in a challenge by critics of the ECB’s quantitative-easing program, asking judges whether the ECB had overstepped its powers. The EU court last year faced a stinging attack from the German judges over its 2018 decision to back the ECB, arguing the Luxembourg-based tribunal had overstepped its powers.Quick ResolutionEuropean Central Bank President Christine Lagarde has called for the legal attack to be “dealt with in short order” in order to free up the funds, which particularly assist the bloc’s most debt-laden nations.Bundesbank President and ECB Governing Council Member Jens Weidmann said he doesn’t expect the court to block Germany’s participation and appealed to the judges to resolve the issue swiftly. A decision is expected within days.Read More: U.S.-Style Fiscal Boost Isn’t Answer for Europe, Weidmann SaysOptimism and RisksThe recovery fund, which will see the EU borrow money on financial markets to finance economic support measures for member states, is seen as a key pillar in the region’s battle against the fallout from coronavirus. It’s also expected to inject more optimism into European assets.Read More: Euro Zone’s Crunch Quarter for Crisis Recovery Is Starting BNP Paribas SA expects European bond yields to catch up with their global peers in the second half of the year, citing a “glass half full” view on fiscal policy, among other measures. BofA Global Research sees the fund benefiting banks, capital goods, utilities and renewables.Pictet is also a believer in Europe’s recovery, raising its year-end forecast for German 10-year bond yields to 0% from minus 0.2% previously. Yet that hasn’t stopped the wealth manager from war-gaming risks in the event of a delay to the fund.It “could put our forecast of the 10-year Bund yield moving to 0% later this year at risk,” wrote analysts led by Thomas Costerg in a note to clients.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Reuters

Brooklyn man accused of using information from Bloomberg reporter for insider trading

A Brooklyn man indicted for an insider trading scheme used information from a Bloomberg News reporter about certain deals to trade, according to a review of the charging documents, in a case that comes as the volume of leaked information about mergers and acquisitions is rising. On March 23, a federal grand jury indicted 38 year-old Jason Peltz for trading on “material nonpublic information” obtained from a company insider and a financial reporter. Peltz has been charged with securities fraud, money laundering, tax evasion, among other offenses, according to the indictment filed in the Eastern District of New York.
Bloomberg

Credit Suisse Seeks to Put Gupta Trading Unit Into Insolvency

(Bloomberg) — Credit Suisse Group AG is seeking to push one of Sanjeev Gupta’s key commodities-trading units into insolvency, presenting a new threat to his metal empire after the collapse of his biggest lender.The application to wind up Liberty Commodities Ltd. was filed in the U.K.’s insolvency court late Tuesday by a unit of Citigroup Inc. Citi was acting under instructions from Credit Suisse, according to a person familiar with the matter who asked not to be identified discussing private information.The move marks a dramatic turn for the worse in Gupta’s battle to secure the survival of his corporate empire. For several weeks since Greensill Capital collapsed into insolvency, Gupta and his GFG Alliance have been searching for new financing while simultaneously trying to persuade his existing lenders to hold off.And in another blow for Gupta’s embattled empire, Morgan Stanley and ICBC Standard Bank, two lenders to GFG’s aluminum smelter in Dunkirk, France, have started talks with potential buyers of their loan exposure to the group, according to people familiar with the matter. An unnamed lender sought to sell $7 million of the debt at 15% discount on Wednesday, separate people familiar said.Morgan Stanley, ICBC Standard Look to Sell Gupta’s GFG Loan“GFG Alliance is in constructive discussions with Grant Thornton, Greensill’s administrators, to negotiate a consensual and amicable solution on the way forward, which is in the best interests of all stakeholders,” a GFG spokesperson said. “While this takes place we will vigorously defend any legal action on the grounds that we have a three-year committed facility with Greensill.” The spokesperson declined to comment on the potential sale of the smelter loans.Representatives for Credit Suisse, Citi, Morgan Stanley and ICBC Standard Bank declined to comment.Liberty Commodities Ltd. is one of the main units of Gupta’s trading business and had revenue of $4.2 billion in the year to March 2020. It is one of a number of companies in Dubai, Hong Kong and elsewhere that are owned by Liberty Commodities Group Pte, a Singaporean entity, and through which Gupta’s commodity trading business are run. The annual report says that Sanjeev Gupta is the ultimate beneficial owner.The trading business has a presence in 30 countries and has been involved in buying and selling industrial metals for the past 25 years, according to its website. It trades more than 10 million tons of steel and 35,000 tons of nickel annually, according to a brochure published in 2020.Credit Suisse was a major lender to GFG via funds that bought debt packaged by Greensill Capital. The Swiss bank decided to liquidate the funds earlier this month after Greensill failed to extend insurance coverage for some of the loans.Gupta’s GFG Alliance has held preliminary talks with York Capital Management and White Oak Global Advisors to partially replace the Greensill financing, Bloomberg reported earlier this month. It’s also looked to governments for help, but a request for a 170 million-pound ($234 million) bailout from the U.K. was rejected due to “concerns” over how the money would be used.In a podcast for his employees published over the weekend, Gupta said the past month had been “the most difficult month of my life without any exception.” He said there was “incoming interest from financiers wanting to refinance the Greensill debt”, but that he was also preparing a defense in case of any dispute with Greensill’s administrator.(Updates to add auction of GFG loans in fourth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg

OPEC+ Shows Confidence in Economic Recovery With Oil-Supply Hike

(Bloomberg) — OPEC+ expressed growing confidence in the global economic recovery by agreeing to increase oil production gradually in the coming months.Before Thursday’s meeting, the cartel had been widely expected to maintain its cautious stance by rolling over the current supply cuts, just as it did last month. Yet Saudi Arabia and its allies showed they are more convinced now that fuel demand is on a firmer footing after a yearlong beating from the coronavirus.As countries like the U.S. rapidly expand their vaccination programs, there are growing signals that the oil market is healing. Last week, American refiners processed the most crude since the pandemic started as they prepared for a surge in driving and flying.Although European oil consumption is weak as France, Germany and Italy extend or impose new lockdowns, demand indicators from China remain strong. The global seven-day average of commercial flights taking off each day hit on a post-pandemic high of 77,708 on Wednesday, according to data from Flightradar24.“Even in those sectors that were badly hit such as airline travel, there are signs of meaningful improvement,” Saudi Energy Minister Prince Abdulaziz bin Salman said at the opening session of the OPEC+ videoconference.The Organization of Petroleum Exporting Countries and its allies will add more than 2 million barrels a day to world oil supplies from May to July. That will restore about a quarter of the crude they are still withholding after making deep cuts a year ago in response to the pandemic.With oil prices firmly above $60 a barrel, the group has been under pressure to open the taps. Other commodity costs have also been soaring, leaving central banks from the U.S. to China grappling with the risk of higher inflation just as their governments are pouring trillions of dollars into fiscal stimulus.Major consumers including America and India have been calling on OPEC+ to keep prices under control. U.S. Energy Secretary Jennifer Granholm phoned her Saudi counterpart on the eve of the cartel’s meeting to highlight the importance of affordable energy. Prince Abdulaziz told reporters that they didn’t discuss the oil market.The 23-nation coalition will boost output by 350,000 barrels a day in May, add the same volume again in June and increase by 450,000 barrels a day in July, Prince Abdulaziz told reporters after the meeting. On top of that, Saudi Arabia will roll back its voluntary extra 1 million barrel-a day cut, adding 250,000 barrels a day in May, 350,000 in June and 400,000 in July, he said.“OPEC+ agreed today to cautiously increase production quotas,” Ann-Louise Hittle, Wood Mackenzie Ltd.’s vice president of macro oils, said in a note. “The agreement is supportive of oil prices, yet should also help avoid a sharp spike upward as oil demand picks up.”Brent crude rose after the decision, climbing 3.2% to $64.75 a barrel in London.Testing TimesThe Saudi minister said OPEC+ was now “testing” the market, and has the opportunity to reverse course if necessary at its next meeting on April 28.As the world’s largest crude exporter, the kingdom has an unrivaled overview of the health of the global economy. Its state-owned company, Aramco, has visibility of oil demand two months in advance — the time period in which it informally receives orders from global refiners. So the decision to increase production indicates that Riyadh is seeing sufficient demand for the supplies it will restore in May and June.“We need to keep our finger on the market pulse and not allow an overheating or a significant deficit,” Russian Deputy Prime Minister Alexander Novak said at the opening session.For the last two months, Russia and Kazakhstan have been boosting their output while everyone else in the group kept theirs unchanged or cut even deeper. Thursday’s agreement was also an effort to diminish the internal strains this policy was causing.Abu Dhabi was becoming increasingly unhappy at the preferential treatment received by one of the group’s most powerful members, a delegate said. Now, all members get to share the benefits of the demand recovery.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg

Bond Traders Gird for More Pain After Biggest Loss Since 1980

(Bloomberg) — Everyone’s excited about the prospects for a sharp economic recovery as increasing numbers of Americans get their Covid-19 vaccinations. Well, almost everyone — holders of U.S. Treasuries have serious reasons for concern. The debt is capping its worst quarter since 1980, when former Federal Reserve Chair Paul Volcker was trying to break inflation by sending rates soaring. And with the economy returning to normal, investors are bracing for higher yields and even more losses to come.The Bloomberg Barclays U.S. Treasury Index sank 4.25% in the three months to March 31, as the bonds came under pressure after the Democrats took the Senate in January and paved the way for a surprisingly large $1.9 trillion spending program championed by President Joe Biden. Add the U.S.’s accelerated vaccine rollout and the Fed’s reluctance to push back against higher yields, and you get a selloff that drove the 10-year rate to the highest since January 2020.Traders and investors see this dynamic extending into the second quarter — and the rest of the year — as the Biden administration seeks yet another multi-trillion dollar spending plan and further speeds vaccine deployment. However, the pace of the losses should be more contained, even as the specter of volatility looms.In the first quarter, the market was “firing off on all cylinders when it came to the trajectory toward higher yields, because you had a pathway toward improving fundamentals,” Subareas Rajappa, head of U.S. rates strategy at Societe Generale, said. “I definitely see the case for a steady rise in yields from here on.”Yields on the 10-year climbed more than 80 basis points during the quarter, peaking at 1.77% on March 30, an astonishing about-face after hitting a historic low of 0.31% in March 2020. The 30-year bond had a similar story. While the quarterly jump for both tenors was higher in 2016, the historically low starting point this time set the stage for bigger losses as yields rose.Meanwhile, the breakeven inflation rate for 10-year Treasury inflation protected securities, a gauge of investor expectations for the pace of annual consumer price gains over the next decade, climbed 39 basis points over the quarter and at one point reached as high as 2.37%, a level unseen since 2013.Yet, while that points to inflation running hot enough for the Fed to reach its 2% target, it’s still a far cry from the kinds of forces former boss Volcker sought to tame around four decades ago. And with the Fed’s target range for overnight rates solidly anchored near zero, and its quantitative easing program continuing apace, the picture in short-term yields and monetary conditions is vastly different.Priced In Already?By now, investors have largely priced in much of the encouraging news, so this type of “very disorderly” selloff is likely to abate in the second quarter, according to Bank of America strategist Ralph Axel. The risk is that the upbeat expectations about the recovery haven’t fully materialized yet, opening the door to possible shocks along the way.“The range of outcomes is still very wide,” Axel said. “We’re talking about the darkest depths of the recession or one of the biggest possible growth years we’ve had in decades. We’re kind of teetering between those two possibilities.”Bond investors are also likely to continue challenging the Fed’s resolve, Rajappa said. The most recent phase of the selloff has been led by five- to 10-year notes, which suggests investors are pricing in a more near-term removal of accommodation. Bank of America expects intermediates to underperform as rates continue to climb, Axel said.A slew of Wall Street analysts see the 10-year ending 2021 at around 2%, but there’s potential for a move closer to 2.2% given the expected strong economic recovery, Loomis Sayles portfolio manager Peter Palfrey said. The speed limit on the U.S. economy has increased, meaning the Fed might need to raise its policy rate beyond 2.5%, which would portend higher yields. However, potential tax hikes to pay for the upcoming spending package could impede growth and temper the ascent, he added.(Updates prices throughout.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg

U.K.’s Giant Battery Factory Developer Looks for a SPAC Deal

(Bloomberg) — Britishvolt Ltd., the developer of the first giant battery factory in the U.K., is considering going public.The company has appointed Guggenheim Securities LLC and Barclays Plc as advisers to look into options including listing in the U.S. through a merger with a special purpose acquisition company, or SPAC, Orral Nadjari, founder and chief executive officer of Britishvolt, said in an interview. The deal could be announced as soon as the end of this quarter, he said.It’s the first time the company has talked in detail about its plans to finance the 2.6 billion-pound ($3.6 billion) project that will play a central role in delivering Prime Minister Boris Johnson’s green plan. The U.K. has banned sales of new gasoline and diesel cars by 2030, and needs a factory producing batteries for electric vehicles to avoid falling behind in the global race to lead manufacturing for the energy transition.“The SPAC market is very interesting and is the result of the very mature capital markets in the U.S. that have identified the industrial revolution that is happening now, when we go from the era of internal combustion engine towards an era of electrification,” Nadjari said. “There will be a lot of scale-ups that will need a lot of capital.”The company hasn’t identified any automotive customers yet, and it’s unclear if any automaker will agree on a supply deal with an upstart that’s still seeking funding. Nadjari, a former investment banker, says he’s not worried.By 2040, electric vehicles will make up two-thirds of total passenger car sales in Europe, with more 10 million units sold a year. That will make the continent the second-largest EV market, behind China and ahead of the U.S., according to BloombergNEF.If Britishvolt does agree to a SPAC deal, the target to announce it will be the end of the second quarter or beginning of the third, Nadjari said.Based in Blyth in northeast England, Britishvolt is planning to launch its series B funding round next week to raise as much as 100 million pounds, with Barclays as its financial adviser, Nadjari said. The round already has “a lot of interest” and series C will follow before summer with a cap of 250 million pounds.The series A funding round, which closed in February, made William Harrison, chief executive officer of private equity firm Cathexis Holdings LP, the second-largest shareholder, after Nadjari. Cathexis is the family office of Harrison investing from a low of $3 million in niche EV deals, to more than $100 million when buying established companies or financing infrastructure and real estate, according to its website.Because of its exit from the European Union, the U.K.’s auto industry has little time to localize production of batteries. The Brexit deal reached late in 2020 requires 30% of the content of battery packs for U.K.-built cars to be sourced domestically; the regulation gets tougher in 2024.“The new rules of origin should provide the conditions for the U.K. automotive industry to succeed,” said Stephen Gifford, chief economist at the Faraday Institution, which researches commercial battery developments. “But, to do so, it is now more important than ever that gigafactories are built in the U.K., and quickly, and with well-developed local supply chains.”Ministers are determined for the U.K. to stay in the mix of leading battery-makers in Europe. Johnson has committed 1 billion pounds to help build factories that can produce batteries at scale. Britishvolt has applied for some of the funding and is waiting to hear back.“We have had very fruitful conversations with the government,” Nadjari said. “Definitely government funding is critical for large industrial investment such as Britishvolt.”The Automotive Transformation Fund will likely support one, if not two, giant battery factories, according to the Advanced Propulsion Centre U.K., the non-profit acting as the delivery partner for the funding. The aim is to see the U.K. punch above its weight for battery making compared with the scale of its auto sector.The Faraday Institution estimates the U.K. will need seven giant factories by 2040, each producing 20 gigawatt-hours per year of batteries. Britishvolt is looking at building multiple plants in the U.K., Europe and elsewhere to produce 150 to 200 gigawatt-hours by 2030, Nadjari.“It’s a very exciting period and there is a lot of money in the capital markets looking at ESG propositions,” Nadjari said. “We are uniquely positioned to potentially become the British champion within the energy industry.”(Adds details about government funding in thirteenth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg

China Considers New Bourse to Attract Overseas-Listed Firms: Reuters

(Bloomberg) — China is mulling creating a new stock exchange to lure overseas-listed firms from markets like Hong Kong and the U.S., Reuters reported, citing two unidentified people, marking a new attempt by world’s second-biggest economy to bring its tech success stories back home.China’s State Council asked the China Securities Regulatory Commission to lead studies on how to design the bourse that would target mainland companies listed offshore on exchanges like Hong Kong and the U.S., Reuters said.Beijing is also hoping to attract global firms such as Apple Inc. and Tesla Inc. — currently listed in the U.S. — which would have the option of carving out local businesses and listing them on the new bourse, the report said.The CSRC didn’t immediately reply to a fax seeking comment on plans on the new exchange.Some of the world’s fastest-growing and biggest tech companies have sprung out of China, but few have listed there because of regulatory obstacles. China has made several attempts to lure its tech giants back, including piloting Chinese depositary receipts and setting up a tech-focused board on the Shanghai stock exchange.PC maker Lenovo Group Ltd. and AI startup Megvii Technology Ltd. are both set to list in Shanghai this year using the CDR program kicked off three years ago.Beijing’s latest initiative comes as U.S.-listed Chinese tech heavyweights such as Alibaba Group Holding Ltd., Baidu Inc. and Bilibili Inc. have raised $36 billion through secondary listings in Hong Kong since late 2019.China’s plans could hurt the listing business at Hong Kong’s stock exchange which relaxed its rules to facilitate the secondary listings a few years ago. Chinese firms have flocked there from the U.S. as tensions between Beijing and Washington have threatened to curtail their access to U.S. capital markets.Hong Kong Exchanges & Clearing Ltd. shares reversed earlier gains on Wednesday to close down 1.3%.Read more: Hong Kong’s Mr. Market Wants a Piece of All Your China TradesThose risks flared up again last week when the U.S. Securities and Exchange Commission said it would begin implementing a law that could result in Chinese companies being kicked off U.S. exchanges if they don’t allow American regulators to inspect their audit papers.Read more: Few HKEX Worries as China Mulls Board for Global Firms: ReactOne option under discussion is upgrading an existing exchange such as a smaller bourse in Beijing, Reuters said. The capital’s municipal government has been lobbying for years to upgrade its listing platform for small and medium-sized firms to be the venue for U.S.-listed Chinese firms, the report said.(Updates with more details throughout)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.