Major International Business Headlines Brief::: 30 September 2020

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Major International Business Headlines Brief::: 30 September 2020

 


 

 


 <mailto:info at bulls.co.zw> 

 


 

 


 

 

ü  Disney lays off 28,000 at US theme parks

ü  Extra facility opened for planes grounded by Covid-19

ü  Love turns to hate as LVMH sues 'dismal' Tiffany

ü  Brexit: Blow to UK car industry in search for EU deal

ü  Coronavirus: Hundreds of thousands of airline jobs at risk, warns
industry body

ü  Amazon One: Palm scanner launched for 'secure' payments

ü  Nokia clinches 5G deal with BT to phase out Huawei's kit in EE network

ü  Greggs staff face fewer hours or losing their jobs

ü  B&M discount chain to open up to 45 stores

ü  JSE faces mixed Asian markets on Wednesday

ü  JPMorgan to pay $920 mn for manipulating precious metals, treasury market

ü  Protests and Covid leave Hong Kong stuck in recession

ü  Ethiopia: Expanding Tourism to Rural Areas

ü  Nigeria: African Airlines' Traffic Falls By 90% - Report

ü  The rich are leaving South Africa – with this one country expected to be
a major destination

 

 

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

Disney lays off 28,000 at US theme parks

Walt Disney has announced it will lay off 28,000 employees, mostly at its US
theme parks.

 

Disney cited the parks' limited visitor capacity and uncertainty about how
long the coronavirus pandemic would last as reasons for the layoffs.

 

The company's theme parks have taken a major hit from the pandemic.

 

Disney shut all its parks earlier this year as the virus spread, but only
Disneyland in California remains closed.

 

"We have made the very difficult decision to begin the process of reducing
our workforce at our Parks, Experiences and Products segment at all levels,"
Josh D'Amaro, chairman of the parks unit, said in a statement.

 

The layoffs apply to "domestic employees" of which about 67% are part-time.

 

Disney also has parks in Shanghai, Hong Kong, Tokyo and Paris, which are not
affected by the announcement.

 

Hong Kong Disney reopened last week after shutting down for a second time in
July due to a spike in Covid-19 cases.

 

Except for Disneyland in California, all of the company's parks have now
reopened, although visitor numbers are limited to allow for social
distancing.

 

Disney lost $4.7bn (£3.6bn) in the three months to 27 June, with revenues
for its Parks, Experiences and Products division plummeting 85% compared to
the same quarter in 2019.

 

Mr D'Amaro said the company's problems were "exacerbated in California by
the state's unwillingness to lift restrictions that would allow Disneyland
to reopen."

 

Disney has been working to persuade California to allow the company to
reopen Disneyland.-BBC

 

 

 

Extra facility opened for planes grounded by Covid-19

An aircraft storage facility in Central Australia is now so full that its
owners have had to seek out more space.

 

Many carriers haven't had enough passengers to justify flying during the
pandemic, and have opted to store their planes.

 

Asia Pacific Airline Storage is storing 94 planes at Alice Springs, and will
store more in Southeast Queensland.

 

Analysts say it's a sign of how difficult conditions have become for
airlines.

 

Singapore Airlines and Cathay Pacific as well as their subsidiaries are
storing planes in Alice Springs, as are Fiji Air and Cebu Pacific.

 

Asia Pacific Airline Storage (APAS) has an additional sixteen slots on site,
but they are already booked with existing customers.

 

The site has become a local landmark in the remote town of about 25,000
people.

 

The full APAS facility in Alice Springs, photographed from a hot air balloon
earlier this week.

The company has plans to expand the facility from its current 110 slots to
accommodate 160-200 aircraft.

 

Until the expansion is ready, APAS needs to find extra space elsewhere.

 

"To manage some additional storage requirements we've started to store some
aircraft at Wellcamp in Toowoomba," Tom Vincent, the company's managing
director, told the BBC.

 

At the moment, there are only two planes at the new facility in Southeast
Queensland, but more are due to arrive this week.

 

Rigorous maintenance

Desert conditions are widely regarded by manufacturers and airlines as
preferable for storing planes because it is easier to protect against
corrosion in dry weather.

 

While they are in storage, the planes have to undergo a rigorous maintenance
schedule.

 

"People have this misconception that you just park an aircraft and it sits
there until you want to activate it again," said Mr Vincent.

 

In fact, APAS now has 70 employees ensuring the planes are properly looked
after until the airlines need them again.

 

How the travel downturn is sending jet planes to 'boneyards'

Hundreds of thousands of airline jobs at risk, warns industry body

Mr Vincent said he always expected to expand the facility, but the pandemic
has dramatically increased demand.

 

And while there has been a very slow trickle of planes returning to service,
the vast majority have been entering rather than leaving storage.

 

The facility is not an airline "boneyard" where old planes are stripped for
reusable parts, but Mr Vincent suggested that might become part of the
business if the industry continues to face headwinds.

 

One industry analyst said the facility's expansion is a clear indication of
the difficulty airlines are facing during the Covid-19 pandemic.

 

Flightglobal's Asia Editor Greg Waldron said times are tough for Singapore
Airlines and Hong Kong-based Cathay Pacific - which are both using the
facility.

 

Neither airline has domestic flights, which will likely be the first to
reopen, he said.

 

"If you're something like Cathay Pacific, where you don't have that domestic
market, you're in an extremely difficult situation," he said.

 

However, he said the air freight business remains strong, and will help many
airlines stay afloat.

 

The International Air Transport Association (IATA) has just downgraded its
2020 traffic forecasts.

 

The association now says it expects traffic to be 66% below the level it was
in 2019.

 

Image copyrightMEGAN DINGWALL

The IATA estimates that it will be at least 2024 before air traffic reaches
pre-pandemic levels.

 

"I guess there's not a clear pathway for a return for normality. There's a
lot of industry views out there that a return to pre-covid levels is going
to take many years," Mr Vincent said.-BBC

 

 

 

Love turns to hate as LVMH sues 'dismal' Tiffany

LVMH once said that Tiffany "stood for love" but it now describes the New
York jeweller as a "mismanaged" company with "dismal" prospects.

 

The Louis Vuitton-owner made the claims in a countersuit against Tiffany in
a dispute over a $16.2bn takeover deal.

 

LVMH claims Tiffany is no longer the business it agreed to buy last November
before the pandemic.

 

But Tiffany said LVMH's "specious" arguments are "another blatant attempt"
to not pay an agreed $135 a share.

 

The jewellery firm, immortalised in Truman Capote's novel Breakfast at
Tiffany's, has already filed a lawsuit against LVMH after the French luxury
goods giant said it was walking away from the deal, which was struck last
November before the pandemic.

 

'Burning cash'

Tiffany said it wanted LVMH to complete the takeover "on the agreed terms"
and said it had only experienced one thirteen-week period of losses before
becoming profitable again.

 

"LVMH's specious arguments are yet another blatant attempt to evade its
contractual obligation to pay the agreed-upon price for Tiffany," Tiffany's
chairman Roger Farah said.

 

But in its countersuit, LVMH said Tiffany's top five executives could
receive $100m in bonuses if the deal goes ahead.

 

"The business LVMH proposed to acquire in November 2019 - Tiffany & Co, a
consistently highly-profitable luxury retail brand, no longer exists," LVMH
said in a court document.

 

It also accused the firm of paying large dividend payments when it posted
losses, taking on extra debt and "burning cash".

 

"Tiffany's mismanagement of its business constitutes a blatant breach of its
obligation to operate in the ordinary course," it said.

 

"There are many examples of mismanagement detailed in the filing, including
slashing capital and marketing investments and taking on additional debt."

 

LVMH, which is led by France's richest man, Bernard Arnault, had initially
offered $120 a share for Tiffany before raising it to $135. Since then,
however, Tiffany's share price has dropped and is now trading at $116.44.

 

Tiffany kicked off the spat when it sued LVMH for stalling earlier this
month.

 

Questions about the impact of coronavirus - which has slammed revenue in the
luxury sector and prompted a 36% drop in Tiffany sales in the first half of
the year - cast doubt over the deal.--BBC

 

 

 

Brexit: Blow to UK car industry in search for EU deal

Britain's car industry risks losing out even if there is a post-Brexit trade
deal with the EU, according to documents seen by the BBC.

 

Car parts from Japan and Turkey used in the UK will not be treated as
British, so some exports may see higher tariffs.

 

In a letter, Britain's chief Brexit negotiator says the UK has failed so far
to get the car parts deal it wants, and "obviously cannot insist on it".

 

Having enough parts sourced within the UK and EU is key to a free trade
deal.

 

In a letter to the car industry, seen by the BBC, chief negotiator Lord
Frost says one of their key priorities - that parts and components from
Japan and Turkey count as British in any deal - has been rejected by the
European Commission.

 

This risks some UK automotive production attracting taxes on trade, known as
tariffs, when exported to the EU, even if there is a "zero tariff" trade
deal struck with the EU.

 

What are the sticking points in Brexit trade talks?

Trade talks: What do the UK and EU want?

A separate draft legal text, also obtained by the BBC, lists the UK's
request for manufacturing of electric cars, batteries, and bicycles to be
treated leniently, and count as British, even if the majority of components
come from elsewhere.

 

The letter says: "I am sorry to say that so far they [EU negotiators] have
neither been willing to discuss these nor share any proposed text with us".

 

Both documents refer to the need, even in a deal, for UK manufacturers to
prove that UK-exported goods are actually British-made, with a specified
threshold of British parts, expected to be around a half.

 

Under the terms of an anticipated deal with the EU, any components from EU
countries can count as British - something known as "cumulation".

 

But the letter reveals the requirement for that to be extended to other
partners of the UK and EU, in particular Japan and Turkey, is being refused.

 

Much UK manufacturing is below the required threshold, although the reverse
is not the case for the European Union. The problem is particularly acute
for electric vehicles where an even larger proportion of the value of the
car is contained in the battery.

 

"The commission has made clear that it will not agree third-country
cumulation in any circumstances, which we regret, but obviously cannot
insist upon," says Lord Frost's letter, written on 7 September.

 

Senior figures in the car industry expressed the view that the government
could have chosen to insist on a deal that did contain such measures. But
discussions on such subjects have been stalled by the impasse over fishing
rights and subsidy powers.

 

The original Brexit deal negotiated by former PM Theresa May contained a
route to minimise checks on what are known as "rules of origin".

 

That option was removed as part of the revision to the withdrawal agreement
a year ago. But Lord Frost points out that the UK and EU27 car industries
have jointly asked for such arrangements, including special consideration
for electric vehicle exports.--BBC

 

 

 

Coronavirus: Hundreds of thousands of airline jobs at risk, warns industry
body

Hundreds of thousands of aviation jobs are at risk without more state aid, a
global industry body has warned.

 

The International Air Transport Association (IATA) downgraded its 2020
traffic forecasts, after "a dismal end to the summer travel season".

 

The association, which represents 290 airlines, says it expects traffic to
be 66% below the level it was in 2019.

 

The IATA estimates that it will be at least 2024 before air traffic reaches
pre-pandemic levels.

 

A second surge in Covid-19 cases and more government restrictions meant the
sector has not seen a strong rebound.

 

The travel industry saw a precipitous drop in business after the coronavirus
developed into a pandemic.

 

Through the year major airlines, airports and tour firms have collectively
announced thousands of job losses.

 

"Absent additional government relief measures and a reopening of borders,
hundreds of thousands of airline jobs will disappear," IATA chief executive
Alexandre de Juniac said.

 

He called for Covid-19 tests to be routinely carried out on passengers
before flights depart, to increase consumer confidence in air travel and
make governments more willing to open borders.

 

 

Airlines have already shown signs of struggle this year.

 

Earlier this month Virgin Atlantic announced it was cutting 1,150 more jobs,
on top of 3,500 jobs it had already cut earlier in the year.

 

The move, it said, was necessary for its survival, and was part of a £1.2bn
($1.5bn) rescue plan to secure its future for at least 18 months.

 

Last month, the world's biggest airline American Airlines said it would cut
19,000 jobs in October when a government wage support scheme comes to an
end. The jobs being cut make up 30% of its pre-pandemic workforce.

 

And earlier in the year, United Airlines said as many as 36,000 jobs were at
risk. Germany's Lufthansa warned it could cut 22,000 positions, and British
Airways said it was slashing up to 13,000 jobs.-bbc

 

 

 

Amazon One: Palm scanner launched for 'secure' payments

Amazon has announced a new payment system for real-world shops which uses a
simple wave of the hand.

 

Its new Amazon One scanner registers an image of the user's palm, letting
them pay by hovering their hand in mid-air "for about a second or so", it
says.

 

The product will be trialled at two of Amazon's physical stores in Seattle.

 

But the company said it is "in active discussions with several potential
customers" about rolling it out to other shops in the future.

 

"In most retail environments, Amazon One could become an alternate payment
or loyalty card option with a device at the checkout counter next to a
traditional point of sale system," it said.

 

Amazon also said the system could be used for "entering a location like a
stadium" or scanning yourself into work instead of using an ID card.

 

"We believe Amazon One has broad applicability beyond our retail stores," it
added.

 

Under the skin

Palm scanners are not a brand-new technology, and there are already some
commercially available solutions.

 

"Palm-based identification is based on capturing the vein patterns of the
palm," explains Dr Basel Halak of the Electronics and Computer Science
School at the University of Southampton.

 

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"These patterns are different for each finger and for each person, and as
they are hidden underneath the skin's surface, forgery is extremely
difficult."

 

Dr Halak said the level of security was roughly similar to a fingerprint
scan, but could be used at a distance of a few inches, making it much more
practical.

 

media captionClick's Marc Cieslak tries a device which scans a user's palm
to authorise financial transactions.

 

"In comparison with other form of identifiers such as physical devices, this
form of biometric authentication is based on physical characteristics that
stay constant throughout one's lifetime and are more difficult to fake,
change or steal," he said.

 

Amazon has not detailed exactly how its version of the technology will work,
beyond saying it will use "custom-built algorithms and hardware" and scan
"distinct features on and below the surface" of the hand.

 

But it said one of the reasons it chose palm recognition was that it is
"more private" than some other options.

 

"You can't determine a person's identity by looking at an image of their
palm," it said, possibly a reference to the controversy surrounding facial
recognition.

 

The firm has paused police use of its Recognition facial recognition
software after civil rights advocates raised concerns about potential racial
bias.

 

Amazon said other reasons for the choice included the "intentional gesture"
of holding a palm over a sensor, and the contactless nature, "which we think
customers will appreciate, especially in current times".

 

But privacy group Big Brother Watch criticised the development.

 

"Amazon continues to fill the market with invasive, dystopian technologies
that solve non-existent problems," its director Silkie Carlo said.

 

"No one should have to provide biometric data in order to buy goods or
services. Amazon's attempt to normalise biometric payment and home
surveillance devices risks building a world in which we're more easily
tracked and recorded, which will inevitably disempower citizens."

 

Early adopters can only try out the first version of the technology at two
Amazon Go shops - the company's experiment with a real-world supermarket
that has no checkouts, but instead tracks the shopper and what they pick up.

 

No Amazon account is required. To register, a customer can just insert their
bank card and follow the on-screen instructions to link their palm print to
that payment option, Amazon said.

 

The company promises that the print is not stored on site, but encrypted and
kept securely in the Cloud. Customers could also delete their data via
website, it added.--BBC

 

 

 

Nokia clinches 5G deal with BT to phase out Huawei's kit in EE network

Nokia is set to become a major beneficiary of Huawei being blocked from the
UK's 5G networks.

 

The Finnish telecoms firm has struck a deal to become the largest equipment
provider to BT.

 

Nokia will now provide additional base stations and antennas to let EE
customers' devices make calls and transmit data via the UK firm's 5G "radio
access network".

The deal will also see Nokia replace Huawei in BT's 2G and 4G networks.

 

EE's network already uses Nokia to provide its 3G service.

 

The UK government announced in July that all the UK's mobile providers were
being banned from buying new Huawei 5G equipment after 31 December, and must
also remove all the Chinese firm's 5G kit from their networks by 2027.

 

The decision, which was taken on national security grounds, effectively
ended a strong relationship between BT and Huawei that dated back to 2005.

 

Extended relationship

Earlier this year, BT said Nokia's equipment was used at about a third of
its 4G sites, which were being upgraded to 5G, while Huawei's kit was used
at the remaining ones.

 

At present, Nokia's kit provides coverage to EE customers across parts of
London, the Midlands and various rural locations.

The latest deal will extend BT's use of its telecoms infrastructure products
to further cities and towns including Aberdeen, Cambridge, Dundee, Exeter,
Southampton and York.

 

Reuters reported that it covered about 11,600 sites.

 

Chart showing how the mobile networks operate

It means Nokia is now set to account for about two-thirds of BT's radio
access kit.

 

"It was inevitable that some of Huawei's equipment was going to be replaced
because of the government's decision," commented John Delaney, a telecoms
analyst at IDC.

"The big change here is that BT wasn't planning to use Nokia's equipment in
many densely populated areas, and now they are. But apart from that it's not
a major departure from their earlier plans."

 

It is expected that BT will soon strike a deal to buy kit from a second
vendor to avoid becoming solely dependent on Nokia once Huawei's kit is
banned outright.

"With this next stage of our successful relationship with Nokia, we will
continue to lead the rollout of fixed and mobile networks to deliver
stand-out experiences for customers," said BT's chief executive Philip
Jansen in a statement.

 

Nokia's president Pekka Lundmark said he was delighted to become "BT's
largest infrastructure partner".

 

A spokesman for Huawei claimed that reducing the number of infrastructure
equipment providers risked "delaying the 5G roll-out and undermining
diversity of supply so essential to network security".

 

OpenRan experiments

BT had previously picked another Nordic telecoms kit provider - Ericsson -
to replace Huawei's equipment in its "core" - the most sensitive parts of
its network that route data and voice calls across computer servers to get
them to the right destination.

 

Ericsson is the favourite to be named as BT's second radio access network
kit supplier, but it is still likely to lag Nokia in terms of the number of
5G masts and base stations it would provide..

 

Nokia's deal with BT also says the two will work together to develop an
"OpenRan ecosystem". This refers to a plan to eventually standardise the
hardware used in radio access networks so that one supplier can be switched
for another via software alone, avoiding the need to rip out one firm's
customised equipment and replace it with another's.

 

Vodafone is already testing such technology in Powys, Wales.--BBC

 

 

 

Greggs staff face fewer hours or losing their jobs

Staff at around half of Greggs' stores will have to accept fewer hours or
face losing their jobs as the government's furlough scheme comes to an end.

 

The bakery chain, which employs 25,000 workers, expects business activity to
"remain below normal for the foreseeable future".

 

Chief executive Roger Whiteside said "about 50%" of its shops have staffing
that was too high for customer demand.

 

He added there was "no chance" reducing hours would be enough to stop job
cuts.

 

"Some stores have staff hours which are just off what's needed for current
demand," said Mr Whiteside. "But others are a long way off and will need
significant change."

 

It is not clear if the company will use the government's new Job Support
Scheme where employers and the state top up workers' pay who are on fewer
hours.

 

The scheme will replace the existing furlough programme which is coming to
an end on 31 October. The vast majority of Greggs 25,000 workforce had been
placed on furlough during lockdown and a quarter remained on the scheme when
the company announced its interim results in July.

 

Greggs declined to comment on how many jobs could potentially go from its
shops, of which there are more than 2,000 across the UK. Mr Whiteside said:
"Some shops are well down and, unsurprisingly, these are the city centre
stores or public transport sites."

 

But he said he did not expect cuts to be as steep as those already announced
by Pret a Manager, where 3,000 are losing their jobs, or Upper Crust-owner
SSP, which is making up to 5,000 people redundant.

 

Pret A Manger to cut 3,000 jobs in the UK

CUpper Crust owner SSP to cut up to 5,000 UK jobs

"Those businesses are very concentrated in the areas worst hit by the
pandemic - we've got a much better spread of locations," he said.

 

Greggs said it was currently consulting with unions and employee
representatives about the changes.

 

In a trading statement, it said that since reopening all its shops in July,
like-for-like sales in the three months to 26 September have averaged 71.2%
of the levels recorded in the same period last year.

 

Greggs said sales in September were above that average, with a recovery in
customer visits.

 

However, it said August was a difficult month because of high temperatures
and it was unable to take part in the government's Eat Out to Help Out
scheme because its shops with seating were closed.

 

In addition, average sales remain below the 80% level which Greggs said in
July was needed for the company to break even.

 

Nevertheless, Greggs is moving ahead with opening a net 20 new shops this
year, which it said will be "predominantly in locations accessed by car".

 

The company said it had increased its digital investment during lockdown and
"click & collect" - which allows customers pre-order and pay online before
picking up food at a shop - has now been rolled out at all its stores.

 

It has also launched food deliveries with delivery app Just East and said it
was "seeing encouraging participation levels".

 

Greggs is facing a dilemma that many businesses are currently grappling
with. Act now to deal with the current trading environment? Or hang on to
see if the trends started by the pandemic - such as the accelerated shift to
online - become permanent?

 

It is little wonder that the bakery chain hasn't given any figures on how
many jobs it may cut or how many workers will be placed on reduced hours.

 

When it began consultations with its staff, the government's Job Support
Scheme hadn't even been announced. Greggs was still working on the
assumption that the furlough scheme would end on 31 October.

 

Throw in the government's changed stance on people working from home and the
spectre of a second wave of coronavirus cases and it is nearly impossible
for companies to get a steady enough footing on which to make long-term
decisions.

 

Hotel Chocolat's boss Angus Thirlwell says the pandemic has simply sped up
changes in the way that people are shopping.

 

But that doesn't mean running a company at the moment is any less
precarious. For Hotel Chocolat, that means avoiding knee-jerk reactions. For
businesses everywhere, it will mean navigating a minefield.

 

"Greggs will undoubtedly survive and be able to thrive once again," said
Julie Palmer, partner at business consultancy Begbies Traynor. "But its
struggles tell the story of every business in the UK.

 

"What worked before the pandemic may not work during it. It, like many
others, must adapt and change to the way that the world now works."

 

'A lasting legacy'

Separately, confectioner Hotel Chocolat announced that after a strong first
half, sales and profits tumbled in the second six months of its financial
year as lockdown was imposed.

 

Overall annual sales for the year to 28 June rose by 3% to £136.2m. Revenue
grew 14% in the first six months before sinking by 14% in the second half.

 

Lockdown meant Hotel Chocolat's physical shops were closed for Easter, one
of its key trading periods. It reported a £6.4m pre-tax loss compared with a
£10.9m profit in the previous year.

 

The company said that it had been able to react quickly to the changing
circumstances.

 

When its shops - which typically generate 70% of sales in the second half of
its financial year - were closed two weeks before Easter, it recalled its
inventory to its distribution centres and was able to grow sales online and
through partners who sell its goods.

 

But Angus Thirlwell, Hotel Chocolat's co-founder and chief executive, said
that since reopening its shops, "we are seeing a very patchy picture".

 

He told the BBC's Today programme that while tourist spots such as
Shrewsbury, Hitchin, Truro and Chichester were doing well, "the places that
are tougher are city centres, transit and tourist-based locations... which
is no surprise".

 

"All we're trying to do is disentangle the very short-term kind of impact
from the more longer-term shift towards online," he added.

 

Asked whether the shift from High Street shops to online was permanent or
not, and whether retailers should be changing their business models, Mr
Thirlwell said: "I think there is going to be a lasting legacy from this
which is that five years of what was going to happen anyway has just
happened in five months."

 

He said it could have implications on "where we should have our Hotel
Chocolat locations", but the company was also trying to "avoid doing
knee-jerk reactions".--BBC

 

 

 

B&M discount chain to open up to 45 stores

Discount chain B&M has said it will open up to 45 new stores this year after
sales soared during the coronavirus lockdown.

 

It said its business model was "well-attuned" to customer needs, with
discount goods being sold at out-of-town stores.

 

Retailers have had mixed fortunes during the coronavirus pandemic.

 

In August, retail sales were boosted by increased spending on DIY, but
clothing sales still lagged.

 

Supermarkets and DIY stores are among the retailers that have seen high
demand during the pandemic as people stocked up on food and home improvement
goods during and after lockdown.

 

Last week, Tesco and Morrisons again put limits on the number of some items
that shoppers could buy to try to prevent a repeat of panic-buying which led
to shortages in March.

 

Rising to the challenge

B&M, which sells goods including DIY and foodstuffs, said its staff had done
well to keep up with demand during the half year.

 

It initially closed 60 stores in shopping centres during the pandemic, but
reopened them quite quickly.

 

A spokesman for the group said that a lot of people were looking for ways of
keeping spending down during the lockdown, which attracted new customers.

 

Those customers have kept coming back.

 

Group sales jumped by 25.3% between 29 March and 26 September, and the
retailer raised its earnings forecast for the period to about £285m from its
previous estimate of £250m to £270m.

 

"Our people have risen to the many challenges posed by the Covid-19 crisis,
not least in serving our customers through a period of high demand, keeping
our shelves filled, providing a clean and safe shopping environment, as well
as sourcing higher volumes than we had planned," said Simon Arora, B&M chief
executive.

 

"I thank them all for their commitment, hard work and resilience."

 

B&M said it expected to open up to 45 new stores in the year to April,
mostly in the fourth quarter of the year. However, it warned that some
smaller stores could be closed.

 

Despite bright prospects for some retailers, others have made dire warnings
about the future of retail in the UK.

 

Last week, Next boss Lord Wolfson warned that thousands of traditional
retail jobs were "unviable" because of the accelerated shift to online
shopping brought about by the pandemic.--BBC

 

 

 

JSE faces mixed Asian markets on Wednesday

The JSE faces mixed Asian markets on Wednesday morning, with investors
digesting the outcome of the contentious US presidential debate and Chinese
data.

 

 

The US electoral contest is being closely watched, amid signs of clear
political divisions even as the world’s largest economy grapples with the
fallout from the Covid-19 pandemic.

 

A highly polarised and possibly legally contested US election is just around
the corner, AxiCorp chief global markets strategist Stephen Innes said in a
note.

 

Sentiment has been boosted slightly by Chinese data, which showed earlier
that manufacturing activity in the world’s second-largest economy expanded
in September.

 

In morning trade the Shanghai Composite was up 0.45% and the Hang Seng
1.18%, while Japan’s Nikkei had lost 0.82%.

 

Tencent, which influences the JSE via Naspers, had added 1.58%.

 

Gold was down 0.5% to $1,888.60/oz while platinum had slipped 1.08% to
$874.95. Brent crude was 0.71% weaker at $40.49 a barrel.

 

The rand was 0.21% weaker at R16.95/$.

 

Focus on Wednesday is on US and UK second-quarter GDP data, while locally
inflation numbers for August are also due.

 

Capitec is due to report a more than three-quarters fall in profits for the
six months to end-August later, citing the effect of the Covid-19 pandemic
in a recent trading update.

 

Sasfin Holdings is expected to have swung into a loss in its year to
end-June, amid provisions and a decline in private equity valuations.

 

Electronics group Ellies Holdings is expected to report a widening loss for
its year to end-April later, amid writedowns to its
businesses.-businessday.co.za

 

 

 

JPMorgan to pay $920 mn for manipulating precious metals, treasury market

(Reuters) - JPMorgan Chase & Co has agreed to pay more than $920 million and
admitted to wrongdoing to settle federal U.S. market manipulation probes
into its trading of metals futures and Treasury securities, the U.S.
authorities said on Tuesday.

 

 

 

The landmark multi-agency settlement lifts a regulatory shadow that has hung
over the bank for several years and marks a signature victory for the
government's efforts to clamp down on illegal trading in the futures and
precious metals market.

 

JPMorgan will pay $436.4 million in fines, $311.7 million in restitution and
more than $172 million in disgorgement, the Commodity Futures Trading
Commission (CFTC) said on Tuesday, the biggest-ever settlement imposed by
the derivatives regulator.

 

Between 2008 and 2016, JPMorgan engaged in a pattern of manipulation in the
precious metals futures and U.S. Treasury futures market, the CFTC said.
Traders would place orders on one side of the market which they never
intended to execute, to create a false impression of buy or sell interest
that would raise or depress prices, according to the settlement.

 

This manipulative practice, which is designed to create the illusion of
demand, or lack thereof, is known as "spoofing."

 

Some of the trades were made on JPMorgan's own account, while on occasions
traders manipulated the market to facilitate trades by hedge fund clients,
the CFTC said. The bank failed to identify, investigate, and stop the
behavior, even after a new surveillance system flagged issues in 2014, the
agency said.

 

"The conduct of the individuals referenced in today's resolutions is
unacceptable and they are no longer with the firm," said Daniel Pinto,
co-president of JPMorgan and CEO of the Corporate & Investment Bank.

 

He added that the bank had invested "considerable resources" in boosting its
internal compliance policies, surveillance systems and training programs.

 

In parallel settlements, the bank entered into a Deferred Prosecution
Agreement with the Department of Justice and the United States Attorney's
Office for the District of Connecticut, staving off criminal prosecution on
charges of wire fraud.

 

It also agreed to pay $35 million to settle related charges with the
Securities and Exchange Commission, although the bank's payment to the CFTC
would offset that fine, it said.

 

In an unusual concession, JPMorgan also admitted wrongdoing in agreeing to
the SEC and Justice Dept. settlements.

 

"This record-setting enforcement action demonstrates the CFTC's commitment
to being tough on those who intentionally break our rules, no matter who
they are. Attempts to manipulate our markets won't be tolerated," said CFTC
Chairman Heath Tarbert.

 

The CFTC and Justice Department have taken aim at spoofing in recent years,
using sophisticated data analysis tools to spot potential wrongdoing that it
could not previously detect.

 

Reuters has reported that around 2017, the agency began using techniques it
originally developed to spot healthcare fraud schemes to identify suspicious
trading patterns, including by scanning activity on exchanges.

 

"The idea was: let's mine this data source to see who the worst actors are,"
Robert Zink, a top Justice official who helped lead the effort, told Reuters
in May
https://www.reuters.com/article/us-usa-doj-trading-insight/traders-beware-u-
s-taps-new-tools-to-find-fraud-in-volatile-commodities-market-idUSKBN22X14E.

 

The agency has already charged six JPMorgan traders for manipulating metals
futures between 2008 and 2016. On Friday, meanwhile, two former Deutsche
Bank AG traders were found guilty
https://www.reuters.com/article/us-deutsche-bank-traders-convicted/two-ex-de
utsche-bank-traders-convicted-in-u-s-over-fake-orders-idUSKCN26H00X  by a
federal jury of spoofing, the agency said.-businessday.co.za

 

 

 

Protests and Covid leave Hong Kong stuck in recession

Hong Kong’s economy was already in recession when the pandemic hit in
January. Six months of running battles between pro-democracy campaigners and
local government had deterred many of the visitors who fuel the lucrative
tourism industry, while the threat of violence on the streets and closures
of shops had sent retail sales down nearly a quarter on the previous year.

 

With much of Asia shut down by coronavirus restrictions during the winter
months, there was little expectation of a recovery until the spring, when
the level of infections fell to almost zero across mainland China and most
of the rest of the region, and the measures could be eased.

 

Some analysts expected the recovery to be strong. Hong Kong is a hub for
financial and professional services in competition with Singapore. Many
workers could operate from home and maintain the same level of activity.

 

Q&A

The fight for Hong Kong

Show

But Hong Kong’s dependence on trade from India, the Philippines and the US,
where the virus continues to flourish, left it more vulnerable to a second
spike, and in the summer cases began to rise again. The flare-up triggered
new restrictions on households and businesses and an immediate downturn in
business activity.

 

Last month, the territory’s government said GDP in the second quarter of
this year was down 9%, after a 9.1% downturn in the first quarter.

 

In May, the International Monetary Fund had said it expected Hong Kong to
recover in the second half of the year and predicted that its GDP would drop
just 4.8% during 2020.

 

Retail sales data due out this week will provide a clue about how long the
recession will last and whether a rebound in shopping is likely, though the
widespread reluctance among consumers across China to spend in the way they
did in previous years is expected to keep sales figures subdued.

 

A brighter picture has emerged for those involved in the finance industry,
which remains Hong Kong’s largest business activity, as the stock market has
followed the same trajectory as the US markets to reach all-time highs this
year.

 

However, analysts have become concerned in recent weeks that the summer
increase in infections and the recent collapse in profits and scandal over
suspicious financial transfers at HSBC, which has a large presence in Hong
Kong, could send the market into reverse. So far the Hang Seng index has
fallen to 23,275, having climbed to a high of 26,669 in July.-theguardian

 

 

 

Ethiopia: Expanding Tourism to Rural Areas

The 2020 of World Tourism Day, will be celebrated with the theme of "Tourism
and Rural Development", with the unique role that tourism plays in providing
opportunities outside of big cities and preserving cultural and natural
heritage all around the world.

 

Tourism has been among the hardest hit of all sectors by the COVID-19
pandemic. No country has been spared by the virus. Restrictions on travel
and a sudden drop in consumer demand have led to an unprecedented fall in
international tourism numbers, which in turn have led to economic loss and
the loss of jobs.

 

On this World Tourism Day, the COVID-19 pandemic represents an opportunity
to rethink the future of the tourism sector, including how it contributes to
the sustainable development goals, through its social, cultural, political,
and economic value. Tourism can eventually help us move beyond the pandemic,
by bringing people together and promoting solidarity and trust crucial
ingredients in advancing the global cooperation so urgently needed at this
time.

Tourism Expert Kaleab Belachew told The Ethiopian Herald that, celebrating
tourism outside the city is highly important both in earning revenue and
promoting the tourist sites found across the country. Over 85 percent of
tourism sites are out of the cities. To bring actual change developing
tourist sites found in rural area is important. While doing this the rural
communities will aware all about the significance of the tourism.

 

On the other hand, most of the citizens working in the sector are at the
risk because of job losses and business closures due to the pandemic. At the
same time, the destinations most reliant on tourism for jobs and economic
growth are likely to be the hardest hit. Joblessness is big issue in the
country and tourism is one of the sectors which create jobs for thousands of
citizens easily. Tourism is a lifeline, offering young people a chance to
earn a living without having to migrate either within their respective areas
or abroad, Kaleab indicated.

This year's international day of observation comes at a critical moment, as
countries around the world look to tourism to drive recovery, including in
rural communities where the sector is a leading employer and economic pillar
providing jobs and other economic opportunities.

 

So far the attention given for the rural area is low having abundant natural
and man-made heritage which contributes a lion share to the sector. Focusing
on rural areas is crucial so as to promote those heritages in depth. Each
nation will provide showcase which expressed their culture in their
respective areas. Apart from this connecting tourism with rural areas will
help people to stay at their residential areas than traveling to other parts
of tourism.

 

Celebrating tourism outside the city will help to understand and know rural
lifestyle, culture and others. It can be a variant of ecotourism. Many
villages can facilitate tourism because many villagers are hospitable and
eager to welcome visitors. At the same time urban population are also
interested in visiting the rural areas and understanding the lifestyle.

 

Having abundant potential in the sector the potential is still unexploited.
With nine World Heritage sites and commitment from the government to achieve
reforms, Ethiopia still has room for growth in its tourism sector.
Identifying and developing tourist site is important to generate revenue and
also promote tourism, he noted.

 

While Ethiopia may see a decline in tourism this year, it still shows
tremendous potential. It is home to nine world heritage sites and the
government has highlighted tourism as a key contributor to economic growth
along with plans to improve the investment landscape of the tourism sector
in order to address potential hurdles investors may face.

 

Cooperating with private sectors facilitating infrastructure that connects
rural areas with the urban and the tourist site across the country is highly
important both in promoting and benefiting from the sector. Compared to the
tourist potential of the country still much effort is remained. On the other
hand it has its own impact in strengthening community based ecotourism where
the local community has well aware of their cultural aspects in their
respective areas and involvement in its development and management as well,
Kaleab says.

 

Development through tourism can also keep rural communities to keep and
protects heritages from damage and burglary activities. It is estimated that
by 2050, 68 percent of the world population will live in urban
areas.-Ethiopian Herald.

 

 

 

 

Nigeria: African Airlines' Traffic Falls By 90% - Report

The International Air Transport Association (IATA) has said African air
travel fell by 90 per cent in August, with a forecasted 66% drop in global
travels by 2020 compared to 2019.

 

The previous estimate was for a 63% decline.

 

In its report on Tuesday, it said the 90.1% drop in African air travels was
better than the 94.6% recorded in July.

 

The capacity of African airlines contracted 78.4%, and load factor fell 41
percentage points to 34.6%, which was the lowest among regions.

 

But worldwide, the association representing some 290 airlines carrying over
80 percent of global traffic, said August passenger demand continued to be
hugely depressed against normal levels, with revenue passenger kilometres
(RPKs) down 75.3% compared to August 2019.

 

This was only slightly improved compared to the 79.5% annual contraction in
July.

 

IATA's Director General, Alexandre de Juniac, said, "August's disastrous
traffic performance puts a cap on the industry's worst-ever summer season.

 

"International demand recovery is virtually non-existent and domestic
markets in Australia and Japan actually regressed in the face of new
outbreaks and travel restrictions.

 

"A few months ago, we thought that a full-year fall in demand of -63%
compared to 2019 was as bad as it could get.

 

"With the dismal peak summer travel period behind us, we have revised our
expectations downward to -66%."-Daily Trust.

 

 

 

 

The rich are leaving South Africa – with this one country expected to be a
major destination

AfrAsia Bank and New World Wealth have published the latest 2020 Global
Wealth Migration Review, looking at recent wealth migration trends, while
commenting on the potential impact of the coronavirus outbreak on wealth
migration going forward.

 

Wealth migration figures are a very important gauge of the health of an
economy, said AfrAsia Bank. The group specifically focused on high net-worth
individuals (HNWIs) with wealth of $1 million or more.

 

“For instance, if a country is losing a large number of HNWIs to migration,
it is probably due to serious problems in that country such as crime, lack
of business opportunities etc.

 

“It can also be a sign of bad things to come as HNWIs are often the first
people to leave – they have the means to leave unlike middle-class citizens.
If one looks at any major country collapse in history, it is normally
preceded by a migration of wealthy people away from that country.”

 

Conversely, countries that attract HNWIs tend to be very healthy and
normally have low crime rates, good schools and good business opportunities.

 

Common reasons why HNWIs move:

 

§  Safety – woman and child safety especially.

§  Lifestyle: climate, pollution, space, nature and scenery.

§  Financial concerns.

§  Schooling and education opportunities for their children.

§  Work and business opportunities.

§  Taxes.

§  Healthcare system.

§  Standard of living.

§  Oppressive government.

The group’s data shows that a significant number of wealthy South Africans
are leaving the country, with over 100 HNWIs wealth outflows recorded over
the past year.

 

Global citizenship company Henley & Partners has reported a sharp increase
in South African enquiries in the third quarter compared to Q1 2020, with a
nearly 50% increase in enquiries overall as the pandemic coursed around the
globe.

 

“The tumultuous events of 2020, including the unplanned pause during the
great lockdown, have resulted in people from all walks of life re-evaluating
their circumstances and reconsidering how they wish to conduct their lives
and — for those fortunate enough — choosing where they want to live by
opting for investment migration,” said managing partner and head of South,
East and Central Africa, Amanda Smit.

 

“Many are taking stock and ensuring they are better prepared for the next
pandemic or major global disruption. The relentless volatility in terms of
both wealth and lifestyle has resulted in a significant shift in how
alternative residence and citizenship are perceived by high-net-worth
investors around the world.”

 

Smit said that proactive, wealthy South Africans who have invested in
alternative residence or citizenship for their families are better place
placed to weather potential future storms.

 

Destinations 

 

New World Wealth said that the most popular countries for migrating HNWIs
over the past year included:

 

§  Australia,

§  USA,

§  Switzerland,

§  Canada,

§  Singapore,

§  Israel,

§  New Zealand,

§  UAE,

§  Portugal

§  Greece.

Australia tops the list possibly due to its points-based immigration system
which favours wealthy people, business owners and people with professional
qualifications – especially lawyers, accountants, doctors and engineers, New
World Wealth said.

 

Commenting on the impact of the coronavirus outbreak, the group said that it
is likely to become more difficult to get HNWIs to buy into traditional
investor visa programmes. As a result, many programmes are expected to
reduce their entry requirements in 2020/2021, it said.

 

“We expect Australia, the United States and Switzerland to remain the
preferred HNWI destinations globally over the next decade. We also expect
New Zealand to emerge as a major HNWI destination in the
future.”-businesstech

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2020

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


Bindura Nickel Corporation

 

 

 


Padenga Holdings

 

 

 


Delta Corporation

 

 

 


Meikles Limited

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 


DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
Faith Capital (Pvt) Ltd for general information purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy or
subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
contents or otherwise arising in connection therewith. Recipients of this
report shall be solely responsible for making their own independent
investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and sourced from third parties.

 


 

 


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