Major International Business Headlines Brief::: 13 July 2021

[Bulls n Bears]

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Major International Business Headlines Brief::: 13 July 2021

 


 

 


 <https://www.nedbank.co.zw/> 

 


 

 


ü  Tesla: Elon Musk ‘rather hates’ being company boss

ü  Flipkart: India online retail giant raises $3.6bn in latest funding round

ü  Virgin Galactic may sell $500m of shares after space success

ü  EU puts its digital tax plan on ice

ü  Truck driver visa options under discussion

ü  Super Mario 64 game sells for record-breaking $1.5m at auction

ü  Nigeria: Are Okada and Keke Operators Above the Law?

ü  Nigeria: TCN, World Bank Train 708 Engineers On Electricity Grid

ü  South Africa: Eskom Warns Cold Front Could Lead to Load Shedding

ü  Analysis: Wall Street charges ahead but some option traders hedge against sharp pullback

ü  FAA says new Boeing production problem found in undelivered 787 Dreamliners

ü  Musk tells SolarCity trial that Tesla would 'die' if he wasn't CEO

ü  China's export growth quickens as global vaccinations, easing lockdowns lift demand

ü  Biden to warn U.S. companies of risks of operating in Hong Kong - FT 

 

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

Tesla: Elon Musk ‘rather hates’ being company boss

Elon Musk has revealed that he does not enjoy being the boss of Tesla.

 

"I rather hate it and I would much prefer to spend my time on design and engineering," he told a US court.

 

Tesla's billionaire founder was speaking at the start of a trial where he is accused of pressuring the firm's board members into a $2.6bn (£1.9bn) deal to buy a solar panel firm.

 

Shareholders claim the carmaker's money was wasted on buying SolarCity, which - they say - was running out of money.

 

At the time of the deal, Mr Musk owned a 22% stake in both Tesla and the solar panel company, which was founded by his cousins.

 

"Since it was a stock-for-stock transaction and I owned almost exactly the same percentage of both there was no financial gain," he said.

 

'All part of a master plan'

He also denied exerting pressure on board members, saying that the deal was part of a "master plan" to create affordable vehicles with green power supplies.

 

Shareholders bringing the case against Mr Musk, who is worth $168bn according to Forbes, have asked the court that he repay Tesla the $2.6bn in full. That would be one of the largest ever judgements against an individual.

 

Last year, other board members at Tesla settled a lawsuit over the deal for $60m. Those board members, who excluded Mr Musk, did not admit any wrongdoing.

 

Dan Ives, an analyst at Wedbush Securities, said that investors would be watching the case very closely.

 

The SolarCity deal has been a "black eye" for both Mr Musk and Tesla and a "clear low light" in the company's rise, he wrote in a note.

 

Despite that, Tesla shares rose on Monday, closing more than 4% higher.

 

The trial is expected to last about two weeks. Randall Baron, the attorney for the shareholders, warned the entrepreneur that the case being heard in Delaware Chancery Court was "going to be a grind".

 

Gesturing to a thick folder of documents prepared by Mr Baron, Mr Musk replied: "I can tell by the binder."—BBC

 

 

Flipkart: India online retail giant raises $3.6bn in latest funding round

Indian e-commerce giant Flipkart has raised another $3.6bn (£2.6bn) ahead of an expected stock market debut.

 

The Walmart-backed company said it will use the money to expand its operations and invest further in its grocery, fashion and delivery service.

 

The latest round of fund-raising increased the firm's value to $37.6bn.

 

The new valuation is more than double the amount the American retail chain paid for a majority stake in Flipkart three years ago.

 

Flipkart's chief executive Kalyan Krishnamurthy said the new funds would support the company's expansion plans: "As we serve our consumers, we will focus on accelerating growth for millions of small and medium Indian businesses."

 

"We will continue to invest in new categories and leverage made-in-India technology to transform consumer experiences and develop a world-class supply chain," Mr Krishnamurthy added in a company statement.

 

The new round of funding was led by Singapore's sovereign wealth fund GIC, the Canada Pension Plan Investment Board, Japan's SoftBank and Walmart.

 

The deal marks the return of SoftBank, which sold its stake of around 20% of Flipkart to Walmart as part of the 2018 deal.

 

Other investors included sovereign wealth funds from Malaysia, Qatar and Abu Dhabi.

 

The fund-raising came as the Bengaluru-based company is expected to make its stock market debut as early this year.

 

In 2018, Walmart paid $16bn for a 77% stake in Flipkart and said later said that it could take the company public within four years.

 

In September, the Reuters news agency reported that Flipkart was preparing for an initial public offering outside of India as early as this year, in a move which could value it at as much as $50bn.

 

Since the Walmart deal the company has added many more items to its online store, including groceries and furniture.

 

Flipkart has also increased its warehouse capacity as it battles competition from Amazon's Indian operation and local rival Reliance Industries, which is owned by Asia's richest person Mukesh Ambani.

 

India has seen huge growth in online start-ups, selling everything from groceries to holidays, which has been driven by the rapid adoption of smartphones and cheap mobile data deals.

 

Several of the country's biggest digital start-ups are already on track to sell shares on the stock market.

 

India's biggest food delivery app Zomato is due to make its debut this month, while payments service PayTM is expected to launch its initial public offering by the end of the year.-BBC

 

 

Virgin Galactic may sell $500m of shares after space success

Virgin Galactic has said it may sell up to $500m of shares after completing a successful space trip on Sunday.

 

In a filing, the company says it plans to use cash raised to develop its spaceship fleet and infrastructure.

 

On Sunday, Sir Richard Branson, Virgin Galactic's billionaire founder, reached the edge of space on one of the planes it has been developing for 17 years.

 

He called the trip the "experience of a lifetime" after returning to Earth just over an hour after leaving the ground.

 

The trip also made the entrepreneur the first of the new space tourism pioneers to try out their own shuttles, beating Amazon's Jeff Bezos and SpaceX's Elon Musk.

 

Shares in Virgin Galactic rose about 8% before markets opened in the US on Monday. But they had tumbled 17% by the end of the day, after its share sale was announced.

 

Sir Richard and his Virgin Group currently hold a 24% stake in the company.

 

'Experience it for yourself'

He billed the flight - on which he was accompanied by two pilots and three company employees - as a crucial test of the space tourism experience he expects to begin selling to customers from next year.

 

"I've had my notebook with me and I've written down 30 or 40 little things that will make the experience for the next person who goes to space with us that much better," he said. "The only way sometimes you can find these little things is to get in a spaceship and go to space and experience it for yourself."

 

Some 600 individuals have already paid deposits for tickets that will cost them up to $250,000 - including Space X and Tesla's Elon Musk, according to reports in the Wall Street Journal.

 

Sir Richard first announced his intention to make a space plane in 2004, with the belief he could start a commercial service by 2007.

 

Despite technical difficulties and a fatal crash in 2014, the firm's stock has nearly doubled this year as its commercial launch gets closer.

 

Ken Herbert, an analyst at Canaccord Genuity, said that the company could start taking more flight bookings for wealthy customers soon.

 

"We view Branson's achievement as a massive marketing coup for Virgin Galactic that will be impossible for the public to ignore," he said in a note.-BBC

 

 

EU puts its digital tax plan on ice

The EU has said it will suspend its plans to tax online tech giants in the light of global efforts to agree a minimum corporate tax rate of 15%.

 

The move comes after G20 finance ministers agreed at the weekend to support the global effort, which will now go before G20 leaders in October.

 

The EU said putting its own plan on ice would make it easier to achieve "the last mile" of the international deal.

 

But Ireland declared it would stick to its lower tax level of just 12.5%.

 

"We have decided to put on hold our work on our new digital levy," said European Commission spokesman Daniel Ferrie.

 

G20 finance ministers back deal to tax companies

Amazon has €250m 'back taxes' overturned in court

The announcement coincided with a visit to Brussels by US Treasury Secretary Janet Yellen, who urged all 27 EU countries to join the global deal.

 

"We need to put an end to corporations shifting capital income to low-tax jurisdictions, and to accounting gimmicks that allow them to avoid paying their fair share," she said.

 

Higher revenues

However, Ireland's Deputy Prime Minister Leo Varadkar, said his country's 12.5% corporate tax rate had "worked for Ireland" and said the reform plan was about "big countries trying to get a bigger share of the pie".

 

"We've taken about €10bn a year in corporation profit tax, double what the average European country does per head," he said.

 

"It's one of those examples of where low taxes result in higher revenues, in a world where wealth capital, labour, corporations are very mobile."

 

Governments have long grappled with the challenge of taxing global companies operating across many countries.

 

That challenge has grown with the boom in huge tech corporations such as Amazon and Facebook.

 

Efforts in the UK and EU to tax the online giants have caused friction with the US, which has felt its companies are being unfairly targeted.

 

Now, however, there is widespread support for a plan to make multinational companies pay their "fair share" of tax around the world.

 

So far, 132 countries have signed up to the framework, but it needs ratification from those countries' parliaments - including the US Congress, where Republicans may try to block it.

 

Why change the rules?

At the moment, companies can set up local branches in countries that have relatively low corporate tax rates and declare profits there.

 

That means they only pay the local rate of tax, even if the profits mainly come from sales made elsewhere. This is legal and commonly done.

 

The deal aims to stop this from happening in two ways.

 

Firstly it aims to make companies pay more tax in the countries where they are selling their products or services, rather than wherever they end up declaring their profits.

 

Secondly, a global minimum tax rate would help avoid countries undercutting each other with low tax rates.

 

Not everyone is in favour, however. Apart from Ireland, Hungary and Estonia also oppose plans to harmonise rates.-BBC

 

 

Truck driver visa options under discussion

The government has explored ways to address a shortage of haulage workers, including creating a short-term visa scheme for foreign lorry drivers, the BBC understands.

 

A combination of the Covid pandemic and Brexit has left haulage firms struggling to recruit drivers.

 

Different government departments have discussed options with the industry, including bringing in such visas.

 

But the Home Office said there are no plans to introduce the visas.

 

The industry is pushing for drivers to be added to the so-called Shortage Occupations list, allowing them to qualify for a skilled worker visa.

 

"We need long-term solutions to recruit a new generation of British lorry drivers into the trade, but short-term there is an urgent need for foreign drivers to be allowed in, under the Shortage Occupations list," said Rod McKenzie, managing director of policy at the Road Haulage Association (RHA).

 

The government wants the industry to employ British hauliers.

 

But the industry said that it was impractical in the short term because of the immediacy of the need and the training costs involved.

 

Last week, transport minister Baroness Vere said she had discussed this issue with the haulage sector two years ago, adding: "It was very clear then that foreign labour would not be available to it."

 

Nevertheless, with the training for an HGV driver typically taking six to nine months, people within the industry insist urgent action is needed to overcome the immediate crisis.

 

'Close to crisis'

Businesses have warned that as the economy reopens, a lack of drivers is jeopardising deliveries to retailers and pushing up prices for consumers.

 

The sector is suffering from the impact of the pandemic, which prevented thousands of new drivers from taking their tests last year.

 

At the same time, many foreign hauliers returned home when work dried up during the early stages of the Covid outbreak and have since been unable to return because of immigration rules brought in after Brexit.

 

The RHA estimates that there is currently a shortfall of about 60,000 hauliers and said that the situation for food supplies was "close to a crisis point".

 

There was a risk that some items would run out in supermarkets at certain times in a way similar to "rolling blackouts" for electricity, it said.

 

"We're seeing a real danger to our supplies in the UK because of driver shortages," said Mr McKenzie.

 

With the government set to lift almost all legal restrictions on social contact in England on 19 July, the further opening of the economy could lead to a "day of reckoning", he said.

 

While the industry has been increasing wages to try to attract staff, it is limited by slim profit margins, Mr McKenzie said.

 

It costs thousands of pounds to train up drivers and that is out of reach of many haulage firms and prospective drivers, he added.

 

Alex Veitch, general manager of public policy at industry body Logistics UK, said the situation "has become a crisis".

 

"We need government to provide funding for driver training to open the industry up to as many people as possible and deliver their commitment to provide safe, secure parking for drivers.

 

"Meanwhile, without a temporary visa for drivers - similar to that recently granted to agricultural workers to pick vital crops - the supply chain will break down," he said.

 

The government has already relaxed strict limits on driving time to allow hauliers to work for longer each day.

 

However, while that plan has been welcomed by wholesalers, it has faced criticism on safety grounds.

 

"Extending lorry drivers' hours, as the government is doing, is a bad idea. Tired drivers don't make better drivers or safer roads," Mr McKenzie said.-BBC

 

 

Super Mario 64 game sells for record-breaking $1.5m at auction

A sealed copy of video game Super Mario 64 has sold at auction for more than $1.5m (£1.1m), shattering records.

 

The 1996 cartridge was a launch title for the Nintendo 64 console, and was one of the most influential early 3D platformers.

 

The auction house said there were "fewer than five" copies in such good condition.

 

The sale dwarfed another record-breaker, an original Legend of Zelda cartridge, set just two days before.

 

That original Nintendo Entertainment System (NES) cartridge sold for $870,000 on Friday, briefly making it the world's most expensive game.

 

Neither game was bought for the rarity of its gameplay experience - Nintendo has rereleased both for its Nintendo Switch console.

 

Instead, they have value as physical memorabilia, in the same way as rare trading cards.

 

The Super Mario 64 cartridge was graded by video game collectable firm Wata at a 9.8 A++ rating - meaning it is both in near-perfect condition and its seal is intact and "like new".

 

A high rating is not enough to guarantee a high auction price - although it helps. Another copy of Super Mario 64 in the same auction with a 9.6 A++ rating sold for a comparatively affordable $13,200.

 

But rarer copies of more popular games attract the most bids.

 

Super Mario 64 was the best-selling game for the Nintendo 64 system, and is widely seen as an important game in video game history. It marked Mario's first move into three dimensions, distinct from his side-scrolling origins.

 

While many modern gamers feel it has not aged particularly well and is widely thought to have significant camera issues, it is still considered among the best video games ever made. Heritage Auctions, the company behind the sale, was taken by surprise at the huge price it eventually attracted.

 

Ahead of the auction, much of the attention had been on the rare Zelda cartridge.

 

The 9.0 A-sealed copy of 1988's The Legend of Zelda was the first game in the series, and has gone on to be one of the best-performing and most critically-acclaimed in Nintendo's entire catalogue.

 

It was expected to reach a high price because this copy belonged to an early production run - making it one of the first ever made to still exist. Heritage Auctions said that to its knowledge, only one earlier production copy is known to exist, and may never be put on sale.

 

"This copy [is] the earliest sealed copy anyone can realistically hope to obtain," it wrote.

 

Many expressed surprise that the Mario cartridge - which sold millions and millions of copies - sold for so much.

 

Kelsey Lewin, a director at California's Video Game History Foundation, tweeted: "despite a lack of population reports, there are many known sealed Super Mario 64 first prints".

 

Video game collectables have been fetching higher and higher prices, leading some to question whether the market is over-inflated.

 

The sale of the Zelda cartridge shattered the previous record, set in April for an original NES cartridge of Super Mario Bros, the first side-scrolling platformer featuring the famous plumber, which sold for $660,000.

 

The record-breaking auction this week saw a huge range of collectable games go for high prices - a copy of Final Fantasy III for the Super Nintendo sold for $96,000, as did a copy of Zelda: A Link to the Past.-BBC

 

 

Nigeria: Are Okada and Keke Operators Above the Law?

THE reckless and lawless behaviours of commercial tricycle and motorcycle riders on the roads in Lagos would make one conclude that they are either highhanded or above the law. They operate as if traffic laws were made for other road users and not for them. They now ply routes where they have been prohibited from without fear of arrest.

 

They compete with heavy-duty trucks, high-capacity vehicles on the highways and even on Bus Rapid Transit, BRT, lanes. One major challenge the BRT drivers face daily when on their dedicated lanes is the problem created by the motorcyclists riding recklessly on BRT corridors. These motorcycle riders appear uncontrollable and above the law. They overspeed and even overtake BRT buses on the lanes assigned for BRT. They flout the laws; in fact, some uniformed security personnel who also ride motorcycles disobey traffic laws.

On March 22, 2021, at about 8.00 pm, a nursing mother with her baby escaped death by the whiskers while on a motorbike at Fagba intersection, along Iju Road in Lagos. Officials of the Lagos State Traffic Management Authority, LASTMA, were on ground to rescue the woman and her baby. The victims were lucky to have only sustained minor injuries and were moved to a nearby hospital for first aid treatment and attention.

 

The immediate set of questions that would come to mind are: Why would one be in a hurry to arrive a destination at the expense of his/her life? What would have been more important for a nursing mother to catch up with than the life of her baby? Why would a pillion allow the motorcyclist ride past highways, busy roads or prohibited areas for bikes?

 

The motorbike operator that carried the woman alongside her baby, actually drove against the traffic red light and disobeyed traffic managers operating manually. The erring motorcyclist, in the process, ran into an oncoming vehicle from Jonathan Coker Road to connect Iju Road through the intersection.

The rider was then trapped by a vehicle in the opposite direction. LASTMA officers on ground rushed to save the lives of the baby and that of the mother; they were not in a hurry to apprehend the erring motorcyclist. A close observation at road intersections and junctions where traffic managers or traffic lights are positioned in Lagos, will reveal that these lawless motorcycle and tricycle riders do not wait a minute at signalised junctions to obey traffic instructions whether manually or electronically.

 

If LASTMA officers prioritise arrest of traffic offenders instead of traffic control, then all commercial motorcycles and tricycles would have been confiscated because the riders are habitual traffic law offenders. These commercial motorcycle and tricycle operators are also known to quickly mobilise and repel any attempt by law enforcement agents to arrest them.

 

In fact, they resort to vandalising public properties and anything that indicates or shows ownership by government to express their displeasure or announce their disagreement with the authority. At times, they claim that they are protesting against certain decisions of the government, but they end up destroying public and private properties, causing riot and unleashing mayhem on other road users.

 

There were instances in time past where they mobilised to repel and revolt violently against arrest when they contravened traffic laws even it was clear they did not conform to regulations. There is a notion that all LASTMA officers are generally milk the motoring public when they commit traffic offences. They are seen as 'lions' on the road seeking whom to 'devour'.

 

That notion is untrue, but it is not to rule out the fact that there are no bad eggs among these traffic personnel. There are many other good ones out there who have been spotted and commended by the general public. Some Lagosians, commuters in particular, however, sometimes misconstrue and misrepresent the intentions of LASTMA officials when on duty.

 

They assume their primary assignment is to arrest traffic violators, whereas it is to manage traffic; arrest is secondary. This brings to fore the need for motorcyclists and the three-wheel riders to obey traffic laws and regulations at all times in order to prevent needless crashes or deaths. If the LASTMA men at the Iju intersection that day had dashed to apprehend the traffic offender first, the woman and her baby might not have been alive today.

 

In all, safety of life is paramount, and cannot be negotiated or substituted for early arrival at one's destination. Passengers on board motorcycles are also duty-bound to caution their riders at every given point when they appear to be riding outside what the traffic laws stipulate. Riders of motorcycles and tricycles should learn patience and ensure they always adhere to traffic laws even when they are in haste in the overall interest of saving lives.-Vanguard.

 

 

Nigeria: TCN, World Bank Train 708 Engineers On Electricity Grid

The Transmission Company of Nigeria (TCN) said it is training 708 of its engineers drawn from key departments under the Transmission Service Provider (TSP) section, facilitated by the World Bank.

 

At the opening session of the training in Abuja yesterday, the acting Managing Director/CEO of TCN, Engr Sule Ahmed Abdulaziz, said the training was to expose TCN's maintenance engineers to facility improvement programmes under the World Bank's Nigeria Electricity Transmission Project (NETAP) currently being executed in TCN.

 

Engr Abdulaziz said the training was crucial to ensuring TCN played its role with the new Service Level Agreement (SLA) and its mandate in the West African Power Pool (WAPP).

According to a statement, spokesperson of TCN, Mrs Ndidi Mbah, said: "In all, engineers undergoing this training are those in the Protection, Control and Metering Department (PC&M), Electrical Maintenance Department (EMD) and Lines Maintenance Department (LMD), totalling 708 engineers from the 10 TSP regions nationwide."

 

The Executive Director, Transmission Service Provider (TSP) in TCN, Engr Victor Adewumi, said the training would last for two weeks, adding that only persons with keen interest and determination would emerge from such training as better engineers.

 

The Executive Director, Human Resources and Change Management at TCN, Mr Justin Ishaya Dodo, advised the trainees to make the best use of the opportunity and also to network and make new friends.

 

The General Manager, Programme Coordination at TCN, Engr Joseph Ciroma, urged the graduates to deepen their knowledge as they had adequate resources for the programme.-Daily Trust.

 

 

South Africa: Eskom Warns Cold Front Could Lead to Load Shedding

Eskom is appealing to all citizens to continue using electricity sparingly.

 

This comes as the South African Weather Service issued a warning on Sunday about wet, windy and cold conditions that are expected in some parts of the country this week due to a cold front.

 

The country's meteorological service said strong winds are anticipated on Monday across the Cape provinces and may result in property damage in some areas, following the arrival of a strong cold front.

 

According to Eskom, it has not implemented load shedding since 13 June 2021 due to some improvement in the performance of the generation fleet and a system that is currently performing relatively well.

 

"However, the cold front will increase the demand for electricity, thereby putting pressure on the power system. Therefore, Eskom urges the people of South Africa to help reduce electricity usage in order to ease pressure on the system."

 

Eskom said it would communicate promptly should there be any significant changes to the performance of the system.-SAnews.gov.za.

 

 

Analysis: Wall Street charges ahead but some option traders hedge against sharp pullback

(Reuters) - Even with U.S. stocks scaling record highs day after day and Wall Street's "fear gauge" showing a low level of worry, some corners of the options market indicate investors are growing much more fearful of a sharp pullback than they have been in months.

 

The Cboe Volatility Index (.VIX), known as Wall Street's fear gauge, is back near its post-pandemic lows, showing little investor dread of near-term stock market weakness. But other, less obvious measures are flashing red, indicating concerns that the market could be in for a large drop.

 

It is unusually expensive, for instance, for investors to hedge their portfolios against a sharp decline in the S&P 500 than it is to buy options that would profit from a big gain.

 

A put option hedging against a 10% drop in the S&P 500 by August is about 35 times as expensive as a call option that would profit from a 10% rise. At the height of the stock market panic in March 2020, that downside put option only traded as high as 11x the upside calls, said Amy Wu Silverman, equity derivatives strategist at RBC Capital Markets.

 

Nations TailDex (.TDEX), which measures the cost of hedging against a 3-standard deviation move in the SPDR S&P 500 ETF Trust (SPY.P), is higher than it has been about 90% of the time over the last five years.

 

That type of contrast between the VIX and other measures “is not terribly common,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab.

 

One explanation points to institutional investors -- who Frederick said are more likely to hedge against a big market decline -- moving to protect their downside, while retail investors keep betting on the market to grind higher.

 

Joe Tigay, portfolio manager at Equity Armor Investments, believes the market's mixed signals on volatility mean that investors may run for cover at the first sign of trouble.

 

"My view is that the market is not as hedged as it should be," Tigay said.

 

Some investors are on edge about the economic impact of the spread of the Delta coronavirus variant and worries about how the Federal Reserve will react to inflation and economic growth data, making it prudent to guard against a 5% to 10% drop in stocks, said Arnim Holzer, macro and correlation defense strategist at EAB Investment Group.

 

Many investors have also grown uneasy due to the unusually long stretch of calm trading.

 

Since World War Two, the S&P 500 index has had a decline of at least 5% an average of every 178 calendar days, according to Sam Stovall, chief investment strategist at CFRA. The latest market advance has lasted 292 days without such a fall, the longest period since January 2018, when a 715-day advance was followed by a 10.8% drop for the S&P 500.

 

Seasonality is also a factor. The period from mid-July through October has traditionally been the weakest time of the year for stocks, according to Jeffrey Hirsch, editor of the Stock Trader's Almanac.

 

"U.S. equities have been incredibly resilient," said Chris Murphy, Co-Head of Derivatives Strategy at Susquehanna Investment Group in a recent note to investors. "But with a seasonably weak period approaching and expectations ahead of earnings sky high, it’s worth looking at macro hedges."

 

The Thomson Reuters Trust Principles.

 

 

FAA says new Boeing production problem found in undelivered 787 Dreamliners

(Reuters) - The Federal Aviation Administration (FAA) said late on Monday that some undelivered Boeing (BA.N) 787 Dreamliners have a new manufacturing quality issue that the largest U.S. planemaker will fix before the planes will be delivered.

 

The FAA said the issue is "near the nose on certain 787 Dreamliners in the company's inventory of undelivered airplanes. This issue was discovered as part of the ongoing system-wide inspection of Boeing's 787 shimming processes required by the FAA."

 

The FAA added that "although the issue poses no immediate threat to flight safety, Boeing has committed to fix these airplanes before resuming deliveries." The air regulators added after a review of data it "will determine whether similar modifications should be made on 787s already in commercial service."

 

Boeing declined to comment. Reuters first reported the new production issue to hit Boeing's troubled 787 Dreamliner. The company has about 100 undelivered 787s in inventory.

 

Boeing suspended deliveries of the 787 in late May after the FAA raised concerns about its proposed inspection method, saying it was "waiting for additional data from Boeing before determining whether the company's solution meets safety regulations."

 

The FAA in May had issued two airworthiness directives to address production issues for in-service airplanes.

 

The U.S. planemaker's 737 MAX and 787 have been afflicted by electrical and other issues since late last year, and it had only resumed deliveries of the 787s in March after a five-month hiatus - only to halt them again in May.

 

Two key U.S. lawmakers said in May they were seeking records from Boeing and the FAA on production issues involving the 737 MAX and 787 Dreamliner.

 

The FAA said in September it was investigating manufacturing flaws involving some 787 Dreamliners. Boeing said in August airlines operating its 787 Dreamliners removed eight jets from service as a result of two distinct manufacturing issues.

 

In September, Boeing said some 787 airplanes had shims that were not the proper size, and some airplanes had areas that did not meet skin-flatness specifications.

 

Last month at a conference, Boeing Chief Executive Dave Calhoun said the 787s were "performing beautifully."

 

But he added "the FAA rightfully wants to know more about the analytics and process controls that we put in place, which are different than the ones that we had previously, so that we could be more perfect."

 

Calhoun said he hoped the FAA's review of Boeing's approach was "measured in months and not longer than the calendar year."

 

In February, Reuters reported Boeing was beginning painstaking repairs and forensic inspections to fix structural integrity flaws embedded deep inside at least 88 parked 787s.

 

The fuel-efficient 787 has been a hit with airlines, which have ordered nearly 1,900 of the advanced twin-aisle jet worth nearly $150 billion at list prices.

 

The FAA has been critical of some Boeing safety practices in recent years and imposed a $6.6 million fine on Boeing in February for failing to comply with a 2015 safety agreement.

 

The agency did not allow the Boeing 737 MAX to resume flights for nearly 20 months following two fatal crashes and only after it added significant safeguards to a key system.

 

Last month, Reuters reported the FAA told Boeing in May its planned 777X was not yet ready for a significant certification step and warned it "realistically" will not certify the airplane until mid- to late 2023.

 

The Thomson Reuters Trust Principles.

 

 

Musk tells SolarCity trial that Tesla would 'die' if he wasn't CEO

(Reuters) - Elon Musk insisted in court that Tesla Inc's(TSLA.O)board controls the company but also said the electric vehicle maker would "die" if he wasn't the chief executive, as he ended his first day of testimony on Monday in defense of Tesla's 2016 acquisition of SolarCity.

 

The lawsuit by union pension funds and asset managers alleges the celebrity CEO strong-armed Tesla's board of directors into depleting the company’s assets with the $2.6 billion all-stock deal for SolarCity.

 

The CEO at the time owned a roughly 22% stake in both Tesla and SolarCity, which was founded by his cousins, and some Tesla shareholders alleged the deal was aimed at bailing out Musk's investment in the solar panel company.

 

Kicking off a two-week trial in Wilmington, Delaware, Musk, wearing a dark suit, white shirt and a slightly askew dark tie, testified that he has tried "very hard not to be the CEO of Tesla, but I have to or frankly Tesla is going to die.”

 

Board members and others involved in the deal will testify beginning as soon as Tuesday, when Musk will also return to the witness stand.

 

The lawsuit accuses Musk of dominating the board's deal discussions, pushing Tesla to pay more for SolarCity and misleading shareholders about the company's deteriorating financial health.

 

Musk told the court that the Tesla board handled the SolarCity deal and he was not part of the board committee that negotiated the terms.

 

"I don't even know what happened," he testified.

 

Musk responded calmly during cross-examination from shareholder attorney Randall Baron, but Baron's yes or no questions often elicited lengthy, meandering responses. At one point Musk called the lawyer "a bad human being."

 

Baron asked if the board vetted his Technoking title, which he gave himself in March.

 

“It generated a whole bunch of free press and Tesla doesn’t advertise and it’s helpful to general sales,” he said. He called the title a joke: “I think I’m funny.”

 

Shares of Tesla closed up about 4.4% on Monday at $685.75.

 

Central to the case are claims that despite his minority stake, Musk was a controlling shareholder of Tesla due to his ties to board members and domineering style. That designation would impose a tougher legal standard and increase the likelihood that the court would conclude the deal was unfair to shareholders.

 

Shareholders have asked the court to order Musk, one of world's richest people, to repay to Tesla what it spent on the deal.

 

Musk was initially questioned for about an hour by his attorney, Evan Chesler, who asked him to describe his relationship with the board.

 

“I’d say good," Musk replied. "They work hard and are competent. They provide good advice and are rigorous in acting on behalf of shareholders.”

 

He said he did not set pay for directors or have the ability to fire or hire them. He also said that because he owned the same percentage of stock in both companies and there was no cash involved in the deal, he didn't benefit. He said the merger was aimed at combining Tesla's battery business with SolarCity's sustainable energy generation.

 

"There was no financial gain," he testified.

 

Legal experts said the judge will be looking for evidence that Musk threatened board members or that directors felt they could not stand up to him.

 

"It would be a surprise to most people if the court were to come out and say that he doesn't control here," said Brian Quinn, a professor at Boston College Law School. "Because he certainly acts like he does."

 

Tesla's directors settled allegations from the same lawsuit last year for $60 million, paid by insurance, without admitting fault.

 

Delaware Court of Chancery Vice Chancellor Joseph Slights will likely take months before he issues a ruling.

 

The Thomson Reuters Trust Principles.

 

 

China's export growth quickens as global vaccinations, easing lockdowns lift demand

(Reuters) - China's exports grew much faster than expected in June, as solid global demand led by easing lockdown measures and vaccination drives worldwide eclipsed virus outbreaks and port delays.

 

But overall trade growth in the world's second-biggest economy may slow in the second half of 2021, a customs official warned on Tuesday, partly reflecting the COVID-19 pandemic uncertainties as the Delta virus variant wreaks havoc in some countries.

 

Overall imports also beat expectations, though the pace of gains eased from May, with the values boosted by high raw material prices, customs data showed.

 

Thanks to Beijing's efforts in largely containing the pandemic earlier than its trading partners, the world's biggest exporter has managed a solid economic revival from the coronavirus-induced slump in the first few months of 2020.

 

Exports in dollar terms rose 32.2% in June from a year earlier, compared with 27.9% growth in May. The analysts polled by Reuters had forecasted a 23.1% increase.

 

"Exports surprised on the upside in June, shrugging off the impact of the temporary Shenzhen port closure and other supply chain bottlenecks," said Louis Kuijs, head of Asia economics at Oxford Economics.

 

"The headline US$ numbers suggest that in real, sequential terms shipments held up in June, after having moderated earlier on from the record levels of end-2020."

 

China's trade performance has seen some pressure in recent months, mainly due to a global semiconductor shortage, logistics bottlenecks, and higher raw material and freight costs.

 

All the same, the global easings in COVID-19 lockdown measures and vaccination drives appeared to underpin a strong uptick in worldwide demand for Chinese goods.

 

Germany, for example, which was at first sluggish in its vaccination drive, said this month it had caught up with the United States in terms of the proportion of the population having had one shot of COVID-19 vaccine. Close to half of Americans are now fully vaccinated, while elsewhere in Europe the rate has also increased recently. read more

 

China's strong shipment numbers last month underlined some solid factory surveys overseas. A measure of U.S. factory activity climbed to a record high in June, while Euro zone business growth accelerated at its fastest pace in 15 years. read more

 

The data also showed imports increased 36.7% year-on-year last month, beating a 30.0% forecast but slowing from a 51.1% gain in May, which was the highest growth rate in a decade.

 

China's crude oil imports in the first half fell 3% in their first contraction for the period since 2013, as an import quota shortage and rising global prices curbed buying, but imports of soybeans, natural gas and iron ore rose. read more

 

Asian stock markets, partly buffeted over recent weeks by concerns over the spreading Delta virus variant and easing growth rates in China, extended their gains after the trade data and were headed for the best session in more than two weeks.

 

China's yuan also rose to a near one-week high against the dollar as the data tempered worries over softening GDP growth. On Friday, the People's Bank of China said it would cut the amount of cash that banks must hold as reserves to support the economy, especially as smaller firms were unable to pass on rising raw material costs.

 

PANDEMIC UNCERTAINTIES

 

China's customs administration spokesperson Li Kuiwen said imported inflation risks were manageable, but cautioned that the country's overall trade still faces uncertainties due to the global pandemic.

 

Li, speaking at a news conference in Beijing earlier in the day, said trade growth may slow in the second half of 2021, mainly reflecting the statistical impact of the high growth rate.

 

"But overall we think China's foreign trade in the second half still has hopes of achieving relatively fast growth," he said.

 

China posted a trade surplus of $51.53 billion for last month, compared with the poll's forecast for a $44.2 billion surplus and the $45.54 billion surplus in May.

 

Asia's economic powerhouse has contained a sporadic coronavirus outbreak in one of its major export hubs in southern Guangdong province last month. However, exporters are grappling with higher raw material and freight costs and logistics bottlenecks.

 

Prices for commodities such as coal, steel, iron ore and copper have surged this year, fuelled by easing pandemic lockdowns in many countries and ample global liquidity.

 

"The pandemic-induced surge in retail sales in advanced economies has started to reverse recently as consumption patterns begin to normalise amid reopening," said Julian Evans-Pritchard, senior China economist at Capital Economics.

 

"Once retailers in these countries have rebuilt their inventories, softer consumer demand will feed through into weaker foreign demand for Chinese exports."

 

China's trade surplus with the United States swelled to $32.58 billion in June, Reuters calculations based on customs data showed, up from the May figure of $31.78 billion.

 

Top officials from China and the United States started exchanges in June to address mutual concerns, while the Biden administration is conducting a review of trade policy between the world's two biggest economies, ahead of the expiry of their Phase 1 deal at the end of 2021. 

 

The Thomson Reuters Trust Principles.

 

 

Biden to warn U.S. companies of risks of operating in Hong Kong - FT

(Reuters) - The U.S. government will this week warn companies of increasing risks of operating in Hong Kong and also update a previously issued warning on Xinjiang, the Financial Times reported on Tuesday.

 

The report said that U.S. companies face threats including the Chinese government's ability to gain access to data that foreign companies store in Hong Kong.

 

The risks also included the new law that allows Beijing to impose sanctions against individuals or entities involved in making or implementing discriminatory measures against Chinese citizens or entities, the FT said, citing three people familiar with the matter.

 

On Tuesday, the United States will update a warning that former President Donald Trump's administration issued on Xinjiang last year, FT said, adding that it will stress on the legal risks that companies face unless they ensure that their supply chains are not implicated in forced labour in Xinjiang.

 

The FT report also said that the United States will impose more sanctions this week in response to China's crackdown on pro-democracy protests in Hong Kong and alleged human rights abuses in Xinjiang.

 

China dismisses accusations of genocide and forced labor in Xinjiang and says its policies are necessary to stamp out separatists and religious extremists who plotted attacks and stirred up tension between mostly Muslim ethnic Uyghurs and Han, China's largest ethnic group.

 

The Thomson Reuters Trust Principles.

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2021

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


ART

PPC

Dairibord

 


Starafrica

Fidelity

Turnall

 


Medtech

Zimre

Nampak Zimbabwe

 


 

 

 

 


 <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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