Tag Archives: Commodity / Financial Market News

Verizon confirms the sale of its media business to Apollo for $5 billion | Instant News

Verizon Communications Inc. confirmed on Monday that it plans to sell its media business to Apollo Funds for $5 billion.

After the transaction is completed, the telecommunications company will hold a 10% stake in the company, and the company will be called Yahoo. The Verizon Media umbrella includes brands such as Yahoo, AOL, TechCrunch and Engadget.

+ 0.56%

After the transaction is completed, the company will receive US$4.25 billion in cash and US$750 million in preferred rights. The transaction is expected to be completed in the second quarter.

In pre-market trading on Monday, Verizon’s stock rose 0.5%.Wall Street Journal Reported the sale plan last week.

“We firmly believe in Yahoo’s growth prospects and the macro headwinds driving the growth of digital media, advertising technology and consumer Internet platforms,” ​​Apollo senior partner David Sambur said in a press release.

Verizon Acquired AOL for $4.4 billion in 2015 with Yahoo buys Yahoo for $4.5 billion In 2017.

Verizon CEO Hans Vestberg said in a press release: “In the past two and a half years, Verizon Media has done a very good job reversing its business and has huge growth potential.”

Although the Verizon Media business only accounted for 6% of Verizon’s revenue in the most recent quarter, the sale of assets will allow Verizon to focus more on the telecommunications business and bring in funds to help pay for the expensive 5G network construction costs.

The company pointed out in its latest earnings report that it recently paid approximately $45 billion to the Federal Communications Commission to obtain the C-band spectrum obtained in a recent wireless auction. The company raised US$12 billion in the fourth quarter and more than US$31 billion in the first quarter to purchase spectrum, although various other capital costs are involved in establishing a 5G network.

As of Friday, Verizon’s share price has fallen 1.6% year-to-date, while the SPDR Communication Services Select Sector exchange traded fund

Rose 15.7%, the Dow Jones Industrial Average
+ 0.85%

It has risen by 10.7%.


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Travel documents lead Europe higher as US futures drift ahead of tech earnings surge | Instant News

Travel stocks paved the way for European stocks to rise on Monday after a key official said transatlantic travel may pick up soon. After falling 0.8% last week – the biggest drop since the period ending February 26 – the Stoxx Europe 600 SXXP, + 0.06%, edged up 0.2%. The winners included aircraft engine maker Rolls-Royce RR, + 4.83%, up 4%, and airlines Deutsche Lufthansa LHA, + 3.76% and International Airlines Group IAG, + 4.35 %. European Commission President Ursula von der Leyen said fully vaccinated Americans should be able to travel to Europe over the summer. US ES00 equity futures, -0.05% NQ00, -0.27% were a little lower, ahead of a big week for tech earnings and a Fed move. President Joe Biden’s proposed infrastructure spending package meets resistance in the Senate as Senator Joe Manchin, a key Democrat, said he only supported passage of a bill support from Republicans. The stock market was not hampered by a 0.2 point weaker than expected increase in the Ifo business climate index for Germany. Still on the move, British engineering group IMI IMI, + 7.59%, rebounded 7% after raising its earnings forecasts and launching a share buyback program. Philips PHIA, -3.20%, was down 3% as the company recorded a charge of 250 million euros for a quality issue used in some of its sleep products, alongside a target for increased sales growth . Food and beverage ingredient supplier Tate & Lyle TATE, + 6.37%, jumped 6% as it sold a controlling stake in its primary products business. This follows a report from the Sunday Telegraph that it has started a £ 1.2bn auction for the division, which makes artificial sweeteners. .

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The summer travel season is on the horizon. Expect higher oil prices. | Instant News

Fatih Ispir / Dreamstime Text size Oil prices have climbed more than 25% this year as production is limited and consumption is expected to rise for the summer travel season. Risks to the oil rebound, however, include problems in the deployment of the Covid-19 vaccine and threats to the global economic recovery, a potential return of oil from Iran and an increase in the pace of crude production from major producers. The magnitude of the oil spike is somewhat surprising, says Regina Mayor, a global energy leader at global accounting firm KPMG, who “didn’t expect this kind of surge so early in the market. year”. Futures on US benchmark West Texas Intermediate crude returned to pre-pandemic levels, then some, settling at $ 61.35 on April 21, after falling to $ 37.63 a barrel about a year. Given the production restrictions of the Organization of the Petroleum Exporting Countries and their allies, collectively known as OPEC +, “price optimism has grown,” Mayor Mayor said – although this could probably be more of a “short-term bump in the current environment of increased demand.” and a carefully managed supply. “OPEC + still has more than five million barrels per day of unused capacity on the sidelines, warns the mayor. “After the increases currently planned, this can quickly flood the market if they see a resurgence of shale activity in the United States or other supply threats.” On April 1, OPEC + announced that it would gradually increase daily oil production by 350,000 barrels in May, 350,000 barrels in June and 441,000 barrels in July. He had withheld about eight million barrels per day of production, one million of which was Saudi Arabia’s voluntary cut. The Saudis also plan to ease their voluntary reduction over the three-month period. The OPEC + decision was “an effective compromise that also sets up a methodical approach to frequently monitor” the oil market and adjust the pace of supply additions as necessary, says Adam Karpf, Managing Director of CIBC Private Wealth, United States. any “material surprises” that would emerge from the April 28 OPEC + meeting, “unless there are shocks” that would require an OPEC + response. The group will likely announce continued surveillance of the crude oil market and the “right to have the flexibility to respond to any significant development,” he said. But to balance OPEC + ‘s measured approach, there are ongoing negotiations on a nuclear deal between Iran and world powers, which have included indirect talks with the United States. Tehran is seeking to get the United States to lift the sanctions, which allows them to bring more oil to the market. Karpf says it’s more a question of when, not if, a deal is made. Iran increased its exports in 2021 and many analysts predict a further increase in supply from Iranian crude exports, he said. This does not rule out the risk of an “immediate price response to an agreement with Iran”, but Karpf suspects that OPEC + is already taking into account the hypothesis of a surge in Iranian exports. Meanwhile, the market is “equally if not more focused” on demand, he says. The International Energy Agency sees an increase in demand from 5.7 million barrels per day to 96.7 million barrels per day this year. Problems with the deployment of the Covid vaccine could weigh on the recovery of the economy and demand for oil, Karpf says. A sign of a breakdown in OPEC + ‘cohesion’ and an acceleration in drilling activity in the United States that could threaten OPEC + ‘s market share could put pressure on oil, he said. For now, the market expects a gradual increase in supply and increased demand during the summer travel season, the mayor said. She expects the world benchmark WTI and Brent prices to remain in the 1960s, although Brent could cross $ 70 if OPEC + continues to exercise restraint. .

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Travel and leisure topped list of evolving corporate credit ratings during pandemic | Instant News

The COVID-19 pandemic has been disrupting not only lives and businesses around the world for over a year, but also the credit ratings of major corporations. Corporate credit ratings are a key measure of creditworthiness, but can also determine borrowing costs. They range from AAA to blue chip companies like Johnson & Johnson JNJ, -0.39% and Microsoft Corp. MSFT, + 1.34% to D for defaulting companies. Increasingly, credit ratings may also point to a potential path of recovery for industries hard hit by the protracted public health crisis. Take, for example, travel and recreation, an industry that has seen half of all blue chip companies in the world transition to high yielding, or “junk” status during the pandemic, according to a new report from Credit Benchmark . Even as parts of Europe remain stranded to contain the coronavirus, travel and leisure has seen the highest share of ‘fallen angels’ (at 11.1%) revert to investment grade status during the crisis (see graph below). Fallen Angels, Rising Stars Credit Benchmark The report identified 1,051 fallen angels out of 6,895 companies sampled around the world, or about 15% of the total. He found that about 5% went back to the investment grade. The retail, oil and gas, and auto and parts sectors have also been volatile on the credit ratings front over the past year, according to the report, with migrations between the two main tranches being now a key objective for investors. Read: The next rising stars in the debt world? Probably the Fallen Angels of Businesses Upgrades and downgrades can make a big difference to a business in terms of borrowing costs. The average yield on bonds issued by investment grade US companies is now in the 2.21% range, while it is almost double for those in speculative grade territory at around 4.21%. These rates are important, especially in the past year, as cruise lines including Carnival Corp CCL, -1.52%, Royal Caribbean Group RCL, -1.37% and Norwegian Cruise Line Holdings Ltd NCLH , -2.20%, borrowed billions because their ships were largely idle. See: White House pushes back cruise industry efforts to restart in July, as Florida sues Biden administration But with other ‘clawback’ deals, Carnival shares rose 31.9 % year-to-date Thursday, while those of Royal Caribbean and Norwegian were up about 20%, according to FactSet data. This compares to the Dow Jones Industrial Average’s DJIA, + 0.17%, up 9.5% for the same period, while the S&P 500 SPX Index, + 0.42% was up 9.1%. .

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Recovery in leisure travel in full swing, helping airlines | Instant News

A recovery in leisure travel is “in full swing” and airline bookings are on the rise, Bank of America analysts said in a note Monday, raising their expectations for the stock prices of a few US airlines. A “reopening of trade” that began in November alongside the vaccine news helped raise the market capitalization of US airlines by 7% above pre-pandemic levels, compared to 10% below for the United States. Most of the travel industry, including European airlines and US hotels and cruise lines, analysts told me. “With a strong rally reflected in stocks, the ability to meet or beat estimates will be important and will support the theme of ‘getting back to fundamentals’,” they said. They raised the price targets on “a robust reservation dynamic” and “prefer airlines exposed to leisure with good balance sheets”: Southwest Airlines Co. LUV, -1.12%, Alaska Air Group Inc. ALK, – 1.71%, and JetBlue Airways Corp. JBLU, -0.69%. Delta Air Lines Inc. DAL, -1.03% also achieved a target price increase. Shares of major airlines fell alongside the broader stock market on Monday, but saw a rise in March, with American Airlines Group Inc. AAL, -1.00% leading the pack with a 7% gain to now this month, followed by United Airlines Holdings Inc. UAL, -1.83% with a 5% lead. The US Global Jets ETF JETS, -1.39% gained 0.7% in March and is up 17% over the last 12 months, against 55% for the S&P 500 SPX index, -0.13% in the past 12 months. B. of A analysts raised their price targets on Southwest shares to $ 68 from $ 60; on Delta at $ 49 from $ 46; on Alaska at $ 78 from $ 72; and on JetBlue at $ 22 from $ 19.50. Small airline Allegiant Travel Co. ALGT, -4.74% and Spirit Airlines Inc. SAVE, -2.22% also got target price hikes, with the price target on Allegiant rising from $ 245 at $ 260 and the Spirit price target at $ 37 of $ 36. Raymond James analysts also noted the “encouraging” trends in US airline bookings, saying they have been “the strongest” so far in the pandemic. Travel restrictions imposed during the pandemic have devastated airlines, dampening demand for air travel and major airlines around the world to reduce capacity, lay off employees, cut costs and survive on government bailouts. “We expect investors to… (focus) on the overall recovery in income and cash flow, with earnings season feedback likely to be encouraging as the peak summer season approaches,” the reporters said. Raymond James analysts. “Potential risks include the possible moderation of bookings recovery between the spring / Easter and summer break periods and the more resilient COVID variants taking hold.” For business travel, a “significant” recovery in demand is only expected in the second half of the year, they said. The short-term momentum is “the strongest” for JetBlue and Spirit, they said. .

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