10th Mar 2021 13:06
(Alliance News) - The following is a summary of top news stories Wednesday.
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COMPANIES
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Adidas outlined a new strategic plan, with the sportswear firm eyeing up to EUR9 billion in shareholder returns, doubling its e-commerce sales and also boosting its sustainability credentials. Adidas shares were 5.5% higher at EUR298.10 each in Frankfurt on Wednesday morning. Adidas said the 2021-2025 strategy is designed to "significantly increase sales and profitability" and help it mop up more market share. By 2025, Adidas forecasts its e-commerce sales to double to between EUR8 billion and EUR9 billion. Earlier on Wednesday, Adidas said its e-commerce sales rose 53% to "significantly more than EUR4 billion" in 2020. Total revenue is expected to grow by between 8% and 10% per year on average between 2021 and 2025. Net income growth is expected to average between 16% and 18% during the period. Between 2021 and 2025, Adidas said it eyes returning a total of EUR8 billion to EUR9 billion to shareholders.
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General Electric confirmed it has struck a USD30 billion deal to sell its aircraft leasing unit GE Capital Aviation Services to Ireland's AerCap Holdings. The USD30 billion will consist of USD24 billion in cash, a further USD1billion in notes or cash and GE receiving a 46% stake in the enlarged company. "Today is an exciting day for GE as we mark our transformation to a more focused, simpler, and stronger industrial company," the Boston-based firm said. The Wall Street Journal on Sunday said the pair were in talks about a possible tie-up. AerCap on Tuesday confirmed the discussions. GECAS has more than 1,650 aircraft of different sizes, while AerCap owns, manages or has ordered more than 1,300 aircraft.
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Legal & General reported a "resilient" performance in 2020 and a good start to its five-year plan. Operating profit for 2020 edged down to GBP2.22 billion from GBP2.29 billion the year before, with pretax profit attributable to equity holders down 15% to GBP1.79 billion. The provider of investment management, life assurance and pension services delivered financial metrics in line with its five-year targets despite the pandemic. Cash generation of GBP1.54 billion and capital generation from continuing operations of GBP1.5 billion were both consistent with L&G's goals of GBP8 billion to GBP9 billion over five years. Legal & General's full-year payout was flat at 17.57p, on track for its five-year cumulative dividend ambition of GBP5.6 billion to GBP5.9 billion.
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HSBC Holdings has unveiled a record GBP15 billion lending fund for Britain's small businesses to help spur on their recovery from the pandemic. The group said two-thirds of this year's fund, its biggest ever for SMEs, will be allocated to specific regions to ensure companies throughout the UK are able to benefit. It will also include a GBP2 billion ring-fenced pot for firms trading overseas, as well as GBP1.2 billion for those in the agricultural sector and – for the first time - allocations for technology firms and franchise businesses, at GBP500 million each.
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Disneyland is aiming to reopen in late April at limited capacity after California eased Covid-19 restrictions, Walt Disney Chief Executive Officer Bob Chapek said Tuesday. The world's second-most visited theme park has been closed for almost exactly a year, with the mega attraction near Los Angeles unable to reopen last summer even while other Disney resorts did so worldwide. "Here in California, we're encouraged by the positive trends we're seeing and we're hopeful they'll continue to improve and we'll be able to reopen our Parks to guests with limited capacity by late April," said Chapek. A precise opening date would be confirmed "in the coming weeks," he added.
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Boosted by new contracts for the 737 MAX, Boeing reported Tuesday that new commercial plane orders last month exceeded cancellations for the first time since November 2019. Boeing received 82 orders for its planes in February, including 39 for the 737 MAX, which returned to service in late 2020 following a 20-month grounding after two deadly crashes. Boeing saw 51 order cancellations in February, according to data on its website. The figures point to a partial comeback from one of Boeing's rockiest periods in its more than 100-year history.
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The collapse of UK finance firm Greensill has sparked panic and threatened 50,000 jobs, in particular at the sprawling steel empire of Anglo-Indian billionaire Sanjeev Gupta. Greensill specialised in short-term corporate loans via a complex and opaque business model that ultimately sparked its declaration of insolvency on Monday. The bankruptcy marks a major fall from grace for a company that won a key USD1.5-billion investment from Japan's SoftBank Group in 2019 – and employs former UK Prime Minister David Cameron as advisor. Greensill's failure has put 50,000 jobs at risk, both at the London-headquartered group and across its customer base. One that could be hit hardest is Gupta's GFG Alliance empire, which has 35,000 staff worldwide, including in Britain where its Liberty Steel division employs 5,000 people.
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MARKETS
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Stock markets were mixed to higher and the dollar firm ahead of key US inflation data. The consumer price index for February is due at 1330 GMT. The US inflation rate is seen picking up to 1.7% year-on-year from 1.4% in January, according to FXStreet.
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CAC 40: up 0.7% at 5,965.38
DAX 30: up 0.4% at 14,491.14
FTSE 100: down 0.2% at 6,717.82
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DJIA: called up 0.4%
S&P 500: called up 0.1%
Nasdaq Composite: called up down 0.1%
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S&P/ASX 200: closed down 0.8% at 6,714.10
Hang Seng: closed up 0.5% at 28,907.52
Nikkei 225: closed flat at 29,036.56
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EUR: firm at USD1.1893 (USD1.1888)
GBP: down at USD1.3868 (USD1.3900)
USD: firm at JPY108.77 (JPY108.70)
GOLD: down at USD1,712.40 per ounce (USD1,713.01)
OIL (Brent): down at USD67.81 a barrel (USD68.20)
(currency and commodities changes since previous London equities close)
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ECONOMICS AND GENERAL
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China and the US are in talks to hold a potential meeting of their foreign ministers in Alaska, the South China Morning Post reported. Amid tension between Beijing and Washington, it would be the first high-level contact between the two governments since US President Joe Biden took office in January. Both the Chinese Communist Party's highest-ranking foreign policy official Yang Jiechi and Foreign Minister Wang Yi - who is technically Yang's subordinate - could potentially take part in a meeting with US Secretary of State Antony Blinken, according to the newspaper. The potential venue is the Alaskan city of Anchorage, which lies halfway between Beijing and Washington - and far from the attention of international media.
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Factory prices in China rose in February at the fastest pace in more than two years, official data showed, as the country's vast industrial sector recovered from a coronavirus-induced slump. The producer price index, which measures the cost of goods at the factory gate, rose 1.7% last month according to data from the National Bureau of Statistics, exceeding analysts' expectations. China's PPI had risen for the first time in a year in January, and February's rate was the fastest since November 2018. Analysts expect an increase in global commodity prices to lift inflation further in the world's second-largest economy in the coming months.
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Consumer prices in China fell 0.2% in February, slightly less than analysts expected, dragged partly by food prices. Pork prices were 15% lower than in the same period last year, when the cost of the staple meat soared after China's herds were ravaged by African swine fever. But it is unlikely the recent period of consumer price deflation will persist, said Capital Economics Senior China Economist Julian Evans-Pritchard, who added that the drop in food inflation was caused by shifts in timing of the Lunar New Year.
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US President Joe Biden's massive relief plan is on the verge of clearing Congress with a final vote scheduled for Wednesday, offering a lifeline for millions of American families and businesses and stimulating an economy digging out from the coronavirus pandemic. Democratic leaders said the USD1.9 trillion package, broadly popular with Americans and approved by the Senate at the weekend, heads to the House for likely passage days before a crucial deadline, and culminating a weeks-long negotiation over the cost and scope of the measure. If it makes it to his desk, Biden – who made the American Rescue Plan his top legislative priority – could sign the historic bill into law by the week's end.
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The French industrial sector made a promising start to 2021, posting consensus-topping output growth according to numbers from INSEE. French industrial production rose 3.3% monthly in January, following a 0.7% month-on-month fall in November. January's print beat expectations for just 0.5% growth, according to FXStreet. In manufacturing alone, output also rose 3.3% monthly, following February's 1.4% drop.
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Consumer confidence in Australia climbed in March, according to the latest Westpac-Melbourne Institute gauge. Consumer sentiment rose 2.6% monthly in March to 111.8 points from 109.1 in February. Westpac noted the index is now just 0.2 points off the December level which was a ten-year-high. "The main factors driving the index are improving economic conditions and prospects, both domestically and abroad, particularly as they relate to our labour market," Westpac added, before also noting the promise of vaccine rollouts and Australia's "success" in containing Covid-19.
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