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The Morning Ledger: Chinese Investors Lose Appetite for U.S. Assets |
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President Donald Trump (l.) and Xi Jinping, China's president, shake hands at the Great Hall of the People in Beijing, Nov. 9, 2017. PHOTO: QILAI SHEN/BLOOMBERG NEWS
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Good morning. Chinese investments in the U.S. declined in 2017, in a sign that Chinese investors' appetite for American assets was waning even before trade tensions started flaring up. This could complicate matters for U.S. corporate deal makers looking for Chinese buyers, reports the WSJ's Josh Zumbrun.
Capital controls show effect: China’s total direct investments fell to $39.5 billion in 2017 from $40.4 billion the year before, according to a new U.S. Commerce Department report. Beijing maintains tight controls on capital that have held down outward investments from China and tightened those controls last year.
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Closely watched figures: Although investment from China to the U.S. is small overall -- it makes up less than 1% of foreign direct investment -- it has been of special concern for the White House and Congress. Negotiators from the Senate and the House reached a deal earlier this month to strengthen the procedures for vetting both foreign investments in the U.S. and overseas transactions involving cutting-edge American technology.
Tariffs take hold: China’s business activities faltered in July, adding to signs that trade tensions have started to pinch economic growth. Earlier this month, the Trump administration imposed 25% tariffs on $34 billion worth of Chinese goods, which led to immediate retaliation on U.S. products. The White House has threatened additional levies on exports, further hurting business sentiment.
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Apple Inc., Arconic Inc., Baidu Inc., Charter Communications Inc., Johnson Controls International PLC, Pfizer Inc., Procter & Gamble Co. and Ralph Lauren Corp. are among the companies slated to report earnings today.
U.S. Federal Reserve officials gather for their two-day Federal Open Market Committee meeting in Washington, D.C. They are expected to keep short-term rates steady, reports the WSJ's Michael S. Derby.
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General Electric has been selling off assets as part of its long-term turnaround effort. PHOTO: JOHN MINCHILLO/ASSOCIATED PRESS
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General Electric Co. is seeking a buyer for key parts of its digital unit as the conglomerate unwinds a signature initiative of former Chief Executive Jeff Immelt that loses money despite billions in investment.
Tesla Inc.’s international expansion is gaining momentum, with authorities in Germany and the Netherlands initiating talks with the company to build its first major European factory.
Uber Technologies Inc. said it will stop developing self-driving trucks to focus its autonomous technology solely on cars, reports the BBC.
Starbucks Corp. is joining with e-commerce giant Alibaba Group Holding Ltd. to deliver beverages and snacks, according to people with knowledge of the tie-up, as it seeks to reverse a sales decline in China.
Vivendi SA, Universal Music Group’s parent, will try to sell up to 50% of the world’s biggest music company in an attempt to cash in on a resurgent recording industry.
BP PLC on Tuesday said second-quarter profit jumped, as the company signaled renewed confidence with its biggest deal in 20 years and plans to raise its dividend.
Sony Corp. reported another strong quarter of earnings, buoyed by stable sales of electronics hardware, strength in its PlayStation videogame business and demand for smartphone camera components.
Samsung Electronics Co. reported flat second-quarter net profit, as a big drop in mobile-phone profit dragged down results that were buoyed by its strength in memory chips.
CBS Corp. said its board of directors was in the process of selecting an outside law firm to handle an independent investigation into allegations Chief Executive Leslie Moonves sexually harassed women.
Goldman Sachs Group Inc.'s last batch of crisis-era stock options will have earned top current or former executives at least $3 billion by the time they expire later this year.
Morgan Stanley is changing how it pays its brokers, pushing them to embrace new technology in a move meant to draw in more clients and a bigger share of their wealth.
Standard Chartered PLC said the continuing trade dispute between the U.S. and China is causing clients to delay investment decisions but could be good for the bank over time as more trade is routed between Asian countries.
German auto maker BMW AG is investing €1 billion ($1.17 billion) in a new assembly plant in Hungary, its first factory in Europe in nearly two decades, reports Bloomberg.
French pharma giant Sanofi SA said Tuesday that its second-quarter sales, net income, operating profit and business net income all declined, reports MarketWatch.
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The NYSE’s regulatory arm has accused floor trader Kevin Lodewick of accepting about $2,000 worth of payments from a brokerage-firm employee. PHOTO: RICHARD DREW/ASSOCIATED PRESS
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An alleged kickback scheme at the New York Stock Exchange has revived old questions about whether the Big Board’s floor traders are lining their pockets at the expense of investors.
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Britain’s financial watchdog, the Financial Conduct Authority, should have powers to regulate bank loans to small businesses after it was unable to take action against Royal Bank of Scotland PLC over its treatment of some customers, lawmakers said on Tuesday, reports Reuters.
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China’s ambitious plan to lure technology giants back home is languishing, with companies and regulators blaming each other and a weaker stock market.
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Iran’s local currency hit another record low against the U.S. dollar Monday, extending a historic slide on concerns about new American sanctions due to be imposed next week.
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Sacramento, Calif., U.S. has some of the fastest rising rents in the country, due in part to a lack of new housing construction. PHOTO: MICHELLE DREWES FOR THE WALL STREET JOURNAL
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The share of young construction workers in the U.S. declined nearly 30% from 2005 through 2016, contributing to a labor shortage that has meant fewer homes being built and rising prices -- possibly for years to come.
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Many U.S. cities and states can no longer afford the unsustainable retirement promises made to millions of public workers over many years. By one estimate they are short $5 trillion, an amount that is roughly equal to the output of Japan, the world’s third-largest economy.
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The eurozone’s economy slowed further in the three months through June, as exports sputtered and business confidence weakened on worries over future relations with the currency area’s largest trading partners.
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The Bank of Japan Tuesday kept its ultra-easy monetary policy in place, but Governor Haruhiko Kuroda said he would let a key interest rate rise more than previously -- a nod to criticism about the side effects of prolonged easing.
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Australian households could be subject to a severe shock if the Australian dollar were to depreciate suddenly, triggering a rise in interest rates, ratings firm Moody’s Investors Service said Tuesday, reports The Australian Financial Review.
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Tesla Inc., the Palo Alto, Calif. electric car manufacturer, appointed Dave Morton as chief accounting officer, effective August 6, 2018. Mr. Morton joins the company from Seagate Technology PLC.
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At Seagate, Mr. Morton served as executive vice president and chief financial officer. In his new role, he will receive an annual base salary of $350,000 and a $10 million new hire equity grant in the form of restricted stock units or stock options, or a combination thereof, Tesla said in a filing.
Seagate Technology PLC, a Cupertino, Calif. provider of data storage technology, appointed Kathryn R. Scolnick as interim CFO while the company conducts a search for a new CFO. Ms. Scolnick has served as senior vice president of finance, corporate communications and treasury since 2016. Compensation details were not immediately available.
Centrica PLC, a British energy company, has appointed Chris O'Shea as group CFO and executive director, effective November 1, 2018. Mr. O'Shea succeeds the company's current CFO Jeff Bell who will be stepping down at the end of October after over four years in his role. Compensation details were not immediately available.
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