(Kitco News) - The gold market is holding on to strong gains, and seeing little reaction as U.S. consumers feel less optimistic in June.
Tuesday, the U.S. Conference Board, said that its Consumer Confidence Index fell to a reading of 121.5, down from May's reading of 134.10 and missing expectations. According to consensus forecasts, economists were expecting a reading around 132.0.
According to the report, this is the lowest reading since September 2017.
The gold market is seeing little reaction to the weaker-than-expected data. However, disappointing consumer sentiment could continue to weigh on economic growth expectations and support further rate cuts from the Federal Reserve, according to some economists. August gold futures last traded at $1,435.90 an ounce, up 1.25% the day.
The report showed broad-based weakness with the Present Situation Index falling to 162.60, down from May’s reading of 170.7. Meanwhile, the Exaptation Index dropped to 94.1, down from the previous level of 105.
The Conference board also warned that consumer sentiment could fall further as the trade tensions between the U.S. and China escalate.
“The decrease in the Present Situation Index was driven by a less favorable assessment of business and labor market conditions. Consumers’ expectations regarding the short-term outlook also retreated,” said Lynn Franco, senior director of economic indicators at The Conference Board. “The escalation in trade and tariff tensions earlier this month appears to have shaken consumers’ confidence. Although the Index remains at a high level, continued uncertainty could result in further volatility in the Index and, at some point, could even begin to diminish consumers’ confidence in the expansion.”
FedEx has already been accused of diverting Huawei's shipments, and it's not keen on dealing with more complaints. The courier has sued the US Commerce Department (including Secretary Wilbur Ross and Assistant Secretary Nazak Nikakhtar) to absolve itself of the need to monitor packages for potential export violations by Huawei and other companies. It argued that the requirement not only violated the Constitution's protections for due process, but was technically unfeasible given the scale of FedEx's operations.
The company handles about 15 million packages every day, according to the complaint, and it would be a "virtually impossible task" to inspect all of them. It might sometimes violate privacy rights and laws. And without safe harbor protections, FedEx believes it's in a no-win situation where it either risks "immediate" fines and penalties from the US or deals with the wrath of foreign governments and its own customers.
FedEx didn't mention Huawei by name in the lawsuit, although there's little doubt that the Chinese company is the focus of the case. The placement of Huawei on the Commerce Department's Entity List, which bars US companies from doing business without explicit permission, forced numerous businesses to either sever ties with the company or stay on guard like FedEx has.
The Commerce Department told the Wall Street Journal it hadn't yet reviewed FedEx's suit, but said it planned to defend its role in national security. You can expect it to contest the accusations, then. And that may leave FedEx in a tough spot when China is drafting its own 'unreliable entities' list that might punish companies for complying with US orders.
Close-up of logo for Amazon Prime deals on Prime Day, on a paper on a light wooden surface, San Ramon, California, July 18, 2018. (Photo by Smith Collection/Gado/Getty Images)
Amazon just released the dates of Prime Day – and this year the sale event will be the longest ever, lasting a full two days.
Prime Day, the annual shopping event for Prime members, will run July 15 to 16. Like previous years, the best deals usually feature Amazon’s own products, like the Amazon Fire TV and the Echo smart speaker. An early deal, Toshiba HD 43-inch Fire TV Edition Smart TV, is selling at $179.99, 40% off the regular price.
Amazon (AMZN) started Prime Day in 2015, and it has evolved as the Seattle e-commerce giant’s business footprint expands. In the early years, the main purpose of Prime Day was to attract more people to sign up for Prime, which now costs $119 a year and gives members free 2-day shipping among other perks. Now 59% of U.S. households are Prime members, according to RBC Capital Research. Prime Day has put more focus on engaging members and increasing their spending on the platform. The deals also expanded from online to stores like Whole Foods.
Amazon wants its users to get comfortable with voice shopping, so this year it has pushed some early access to deals only available through its smart speaker Alexa. Amazon also touts one-day delivery on more than 10 million products. The company announced in April it is investing $800 million in the second quarter to speed up delivery times.
Singles Day similarities
BROOKLYN, NY - JULY 11: Guests attend the Amazon Music Unboxing Prime Day event on July 11, 2018 in Brooklyn, New York. (Photo by Kevin Mazur/Getty Images for Amazon)
To spice up the shopping holiday, Amazon seems to have borrowed a page from Alibaba’s playbook, promoting offerings beyond deals that are similar to the Chinese e-commerce giant’s Singles Day.
Started a decade ago, Singles Day is the biggest one-day shopping holiday in the world, scoring $30.8 billion in sales last year. The event usually kicks off with a four-hour gala featuring celebrities both from China and overseas, including Nicole Kidman and Mariah Carey. Alibaba’s Tmall has been working with brands like Mars to launch new products.
For the first time, Amazon is also selling exclusive launches and collaborations on Prime Day, both online and in-store. Levi’s will drop a special version of its iconic jeans designed by football player Sterling Shepard and model Chanel Iman Shepard. In its release Amazon also teased “special performances” and “great entertainment.” Last year, Amazon Music hosted an Unboxing Prime Day concert in New York featuring Ariana Grande and Alessia Cara days ahead of the sale event.
“Our vision is that Prime Day should be the absolute best time to be a member – when you can enjoy shopping, savings, entertainment and some of the best deals Prime members have ever seen,” said Jeff Wilke, head of Amazon Worldwide Consumer.
Krystal Hu covers technology and China for Yahoo Finance. Follow her on Twitter.
AbbVie said on Tuesday it would buy Botox-maker Allergan in a cash-and-stock deal for about $63 billion to add fast-growing therapeutic businesses such as medical aesthetics and eye care.
Allergan shareholders will receive 0.8660 AbbVie shares and $120.30 in cash for each share held, for a total consideration of $188.24 per Allergan share, a premium of 45% to Allergan's Monday close.
The deal is expected to add 10% to adjusted earnings per share over the first full year following the close, the companies said.
AbbVie will continue to be incorporated in Delaware as AbbVie and will be led by Richard Gonzalez as chairman and chief executive officer.
Two members of Allergan's board, including Chief Executive Officer Brent Saunders, will join AbbVie's board upon completion of the transaction.
Allergan's shares soared nearly 30% in premarket trading. Shares of AbbVie were down more than 10%.
Outside Nissan’s shareholders meeting in Yokohama, Japan, June 25, 2019. Shareholders shouted at current board members, Nissan management and each other during the meeting.
Photo:
kyodo/Reuters
TOKYO—
Nissan Motor Co.
NSANY -0.42%
shareholders voted to overhaul the company’s board structure, a key goal of Chief Executive Hiroto Saikawa.
Following a rowdy meeting where shareholders shouted at current board members, Nissan management and each other, the measure passed in large part due to the support of alliance partner
Renault SA,
RNO -1.04%
which owns 43.4% of the Japanese company.
Shareholders approved the creation of new board committees for executive compensation, audit matters and director nominations. They also appointed a new crop of directors, increasing the number of directors to 11.
During the nearly three-and-a-half-hour meeting, shareholders took aim at Mr. Saikawa for the state of Nissan’s business, where sales and profits have imploded in the U.S. and Europe. Some asked him to step down.
Mr. Saikawa said he would work with the new nomination committee on a succession plan.
Some of the harshest questions were directed at Renault Chairman Jean-Dominique Senard, who joined the board in April.
A visibly angry Mr. Senard rebutted those comments, saying he had only sought to do deals that would have been to the benefit of Nissan.
Mr. Saikawa said he was focused on rebuilding Nissan’s struggling car business, but that he would continue to talk to Mr. Senard about the future structure of the Renault-Nissan alliance.
LONDON/LOS ANGELES (Reuters) - U.S. furniture company RC Willey Home Furnishings is so concerned that new global clean air rules will cause transport disruption that it brought forward the shipment of arm chairs and sofas from China by two months.
FILE PHOTO: Shipping containers are pictured at Yusen Terminals (YTI) on Terminal Island at the Port of Los Angeles in Los Angeles, California, U.S., January 30, 2019. REUTERS/Mike Blake/File Photo
The tougher regulations, set by the United Nations shipping agency, the International Maritime Organization (IMO), come into force on Jan 1. Costs will rise for ships towards the end of this year and there will be a knock on effect for trucks and other transporters that move goods around the world.
For shipping companies it is the biggest shakeup in decades and adds to the pressures of an economic slowdown and the threat of an escalating trade war between the United States and China.
While consumers are not expected to pay more for goods, higher transport bills and disruption to company deliveries could further dent economic growth.
Ship owners must cut sulphur emissions to 0.5% from 3.5%. They can do this by using low-sulphur fuel, installing exhaust gas cleaning systems or opting for other, more expensive, clean fuels such as liquefied natural gas or traveling more slowly.
Jeff Child, president of Berkshire Hathaway’s RC Willey Home Furnishings, moved the delivery of about 450 containers from September and October to July and August. He wants to avoid any disruption in the peak fourth quarter as ships prepare for the changes, including refitting equipment.
“We just don’t want to get caught in a situation where it affects our inventory,” he told Reuters.
Analysts say the container industry, which transports consumer goods such as sofas, designer clothes and bananas, will be one of the worst hit with extra costs of about $10 billion.
The world’s two biggest container shipping lines - Denmark’s Maersk and Swiss headquartered MSC - say they face annual extra costs of over $2 billion each. Twenty-five logistics company executives told Reuters they would pass along any IMO-related costs, such as ship upgrades or more expensive fuel, to customers.
“The sulphur cap will further put pressure on ocean freight rates and we... will have to pass those costs on to remain competitive,” Peder Winther, global head of ocean freight with Swiss transportation company Panalpina Group said.
TRUCKERS WORRIED
Economists say manufacturers are expected to absorb their part of the cost and are unlikely to raise the price of consumer goods, but the hit to companies could be a drag on the world economy.
A Nestle S.A. spokesperson said the food group was talking to transport companies about “fuel adjustment methodology” to reflect the impact of the new rules.
“Higher fuel prices would result in higher transport costs,” said Peter Nagle, an economist with the World Bank’s Development Prospects Group. “This would have the potential to lead to slower economic growth and trade.”
Trucking companies will also suffer. The IMO rules do not apply to them but they will face new competition from ships for lower sulfur fuel. This is expected to push up the price of diesel fuel for trucks by as much as 100 percent.
Small to mid-sized truckers may find it tough as they lack the clout to negotiate fuel deals or to recoup the costs.
“I’m at the whim of the market. All I can do is let the customers know what’s going on,” said Mike Baicher, president and chief executive of New Jersey based West End Express, which runs 90 trucks in New York, New Jersey and along the East Coast.
“There is only so much that the trucking company can absorb.”
In a letter sent to top U.S. government officials including National Security Advisor John Bolton, transport associations including trucking groups said there was consensus that U.S. transport industries would be “negatively affected by IMO 2020 pricing pressure”. It said there could be market disruptions.
“There’s a storm approaching but we don’t know how bad the storm is going to be,” said Glen Kedzie, energy and environmental counsel for the American Trucking Associations.
“YOU’RE GOING TO PAY”
Shipping and freight forwarding companies, who offer a service overseeing the delivery of goods from beginning to end, expect to feel more cost pressure.
Bart de Vries, chief operating officer for air & sea with U.S. headquartered Hellmann Worldwide Logistics, expects to pay more for services as shipping companies pass along the costs.
Some companies may overhaul their business plans.
“It will undoubtedly force many exporters and importers to review their sourcing strategies and vendors,” said Cas Pouderoyen, senior vice president of ocean freight with global logistics company Agility
Slideshow (2 Images)
Richard Fattal, co-founder of digital freight forwarder and logistics provider Zencargo, said there could be as much as a 10 to 20% rise in overall operating costs next year.
Allen Clifford, a U.S.-based executive vice president with MSC, said at a recent forum in California that his company was facing huge expenses.
“Who’s going to pay for it? You’re going to pay for it. Because I’m tired of paying for it,” he told industry executives, and port and customs officials.
Additional reporting by Richa Naidu and Karl Plume in Chicago; editing by Anna Willard
Eldorado Resorts is buying Caesars in a cash-and-stock deal valued at $17.3 billion, creating a casino giant.
Monday, June 24th 2019, 5:06 AM PDT
Updated:
Monday, June 24th 2019, 7:33 AM PDT
Eldorado Resorts is buying Caesars in a cash-and-stock deal valued at $17.3 billion, creating a casino giant.
The deal Monday puts about 60 casinos and resorts in 16 states under a single name.
Eldorado will pay $8.40 per share in cash and 0.0899 shares of Eldorado stock for each Caesars share, or $12.75 per share.
The combined business will be called Caesars and its shares will be traded on the Nasdaq stock market.
Shareholders of Eldorado Resorts Inc. will hold about 51% of the company's outstanding stock, with Caesars Entertainment Inc. shareholders holding the remaining and 49%.
The deal is targeted to close in the first half of next year if approved by gaming regulators and shareholders.
(Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)
