(Alliance News) - The following is a summary of top news stories Friday.
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COMPANIES
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Italy's antitrust watchdog imposed EUR20 million in fines on Apple and Alphabet's Google on Friday, the second time the regulator has sanctioned US technology firms this week. European countries have cracked down on the business practices of Big Tech in recent years, while the EU is moving forward with legislation to tighten regulation. The Italian competition authority said it fined Apple and Google EUR10 million each for violations of the consumer code, including failing to provide enough information to customers and resorting to "aggressive methods" in the use of their data for commercial ends. The regulator imposed a EUR200 million fine on Apple and e-commerce platform Amazon earlier this week for restricting access for some sellers of Apple products on Amazon.
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The UK Competition & Markets Authority said it has secured improved commitments from Alphabet's Google on proposals to remove third-party cookies and other functions from its Chrome browser. Back in June, the UK regulator had said it would take up a role in the design and development of Google's Privacy Sandbox proposals to ensure they do not distort competition. "It has been investigating Google's proposals since the start of the year due to concerns that, without the Competition & Markets Authority's involvement, Google's alternatives could be developed and implemented in ways that impede competition in digital advertising markets," the CMA said Friday. The CMA said the proposals could cause advertising spending to become even more concentrated on Google. "The CMA's intervention, and the improved commitments, are designed to ensure that Google's proposals can improve privacy without adversely affecting competition, which would be to the detriment of users," it said. CMA Chief Executive Andrea Coscelli said: "If accepted, the commitments we have obtained from Google become legally binding, promoting competition in digital markets, helping to protect the ability of online publishers to raise money through advertising and safeguarding users' privacy."
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Regulators in China have asked ride-hailing giant Didi to draw up a plan to de-list from the US stock market over data concerns, Bloomberg reported, as Beijing continues its tight scrutiny of domestic tech giants. Over the past year, several of the country's biggest companies – including Alibaba, Tencent and Meituan – have been swept up in a regulatory crackdown that has clipped the wings of major internet firms wielding massive influence on consumers' daily lives. A mammoth New York debut in June for Didi Chuxing was quickly overshadowed by an investigation by the Chinese cyber watchdog on the grounds of cybersecurity, launched just days after the listing. Bloomberg said Chinese regulators now want Didi's executives to take the company off the New York Stock Exchange over worries about sensitive data leakage, citing people familiar with the matter. Privatisation or a share float in Hong Kong are among options.
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Private equity firms CVC Capital Partners and KKR & Co are mulling teaming up for a tilt at acquiring telecommunications firm Telecom Italia, Bloomberg reported. Back on Sunday, Telecom Italia said KKR was interested in buying the company and made a "non-binding and indicative" approach. At EUR0.505 per share, it valued Telecom Italia at around EUR10.8 billion. Telecom Italia shares were 0.8% higher at EUR0.49 each in Milan on Friday, giving the company a market capitalisation of EUR10.22 billion. Bloomberg on Thursday, citing people with knowledge of the matter, reported KKR and CVC have held "exploratory talks" over a potential joint-offer.
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Novo Nordisk said its global sales will take a 3% hit due to insulin procurement policies in China. The Bagsvaerd, Denmark-headquartered pharmaceutical firm said it received results from a volume-based procurement tender for the diabetes drug in China. Volume-based procurement policies are aimed at bringing drug costs down. The tender concerns insulin sold at hospitals. Novo Nordisk said all of its insulin products with the exception of Ryzodeg and Xultophy were included in the tender. However, it expects a 3% hit to global sales growth in 2020 as a result of reduced prices and volumes of insulin it sells in China. The VBP policy for insulin is to be implemented in the second half of 2022.
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Drinks maker Diageo will start on Friday the next tranche of its return of capital programme of up to GBP4.5 billion to shareholders by June 2024. The first phase, completed in January 2020, saw over GBP1.25 billion returned to shareholders, with the second phase ending earlier in November and returning GBP450 million. Now, the third phase, Diageo is looking to buy back up to GBP550 million worth of shares by March 4, 2022.
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Infineon Technologies has appointed Jochen Hanebeck as successor to Reinhard Ploss as chief executive. He will take the post on April 1 next year. His contract runs until March 31, 2027. He has been a member of the executive board and chief operations officer since 2016. Ploss has been at the helm since 2012.
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MARKETS
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Stock markets and oil prices were suffering on Friday after European countries reimposed travel restrictions from Africa because of a new Covid-19 variant discovered in South Africa. Wall Street re-opens for a half-day session after being closed for Thanksgiving Day and is called to start sharply lower. In pre-market activity in New York, lockdown winners, such as home exercise equipment maker Peloton and the ubiquitous Zoom Video Communications were up 6.3% and 9.0%, respectively.
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CAC 40: down 3.2% at 6,850.82
DAX 40: down 2.5% at 15,514.96
FTSE 100: down 2.8% at 7,102.76
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Hang Seng: closed down 2.7% at 24,080.52
Nikkei 225: closed down 2.5% at 28,751.62
S&P/ASX 200: closed down 1.7% at 7,279.30
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DJIA: called down 2.1%
S&P 500: called down 1.7%
Nasdaq Composite: called down 1.2%
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EUR: up at USD1.1264 (USD1.1211)
GBP: down at USD1.3313 (USD1.3321)
USD: down at JPY114.11 (JPY115.34)
Gold: up at USD1,807.00 per ounce (USD1,789.81)
Oil (Brent): down at USD77.74 a barrel (USD81.92)
(currency and commodities changes since previous London equities close)
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ECONOMICS AND GENERAL
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The South African government said the decision by the UK to ban all flights from South Africa over a new variant of Covid-19 seemed "rushed". This comes after scientists in South Africa on Thursday announced that they had detected a new variant called B.1.1.529. In response, the UK imposed a ban on flights from six African nations, including South Africa, due to rising concerns over a new variant. South Africa will try to persuade Westminster to reconsider the decision, it said.
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Germany and Italy joined Britain in banning most travel from South Africa as governments scramble to prevent the spread of a new Covid-19 variant with a large number of mutations. In a sign of the growing alarm, the EU separately proposed prohibiting travel from southern Africa. The EU's executive "will propose, in close coordination with member states, to activate the emergency brake to stop air travel from the southern African region due to the variant of concern B.1.1.529," EU chief Ursula Von der Leyen tweeted Friday. Germany's new travel restrictions, starting Friday night, will affect South Africa and "probably neighbouring nations", Spahn said, with only German nationals allowed entry. They must quarantine for 14 days upon arrival even if vaccinated.
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Hundreds of flights were cancelled, some schools shut and tour groups suspended on Friday after three coronavirus cases were reported in Shanghai, as China continues its strict zero-Covid policy. Beijing has largely succeeded in controlling the spread of the coronavirus within its borders through travel restrictions and snap lockdowns, but frequent domestic flare-ups have tested its no-tolerance strategy in recent months. The three positive cases are friends who travelled to the nearby city of Suzhou together last week, Shanghai health authorities said at a press conference Thursday evening – adding that all had been fully vaccinated. Over 500 flights from Shanghai's two major airports were cancelled on Friday, data from flight tracker VariFlight showed.
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Eurozone money supply growth accelerated in October, figures from the European Central Bank showed. Annual M3 money supply growth ticked up to 7.7% in October, from September's upwardly revised increase of 7.5%. The October figure topped expectations of a 7.4% hike, according to consensus cited by FXStreet. Yearly growth of M1 money supply, comprising of currency in circulation and overnight deposits, was largely unchanged at 11%.
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German import and export prices each grew at the fastest pace in more than 40 years in October, numbers from Destatis showed. Import prices rose 22% annually in October, the fastest growth since a 22% hike in January 1980. Export prices surged 9.5% in October, the highest year-on-year increase since an 11% rise in January 1975. On a monthly basis, import prices rose by 3.8% in October, beating the 2.1% market forecast, according to consensus cited by FXStreet. They had risen 1.3% in September from August. Monthly export price growth was 1.4% in October, after a 0.9% rise in September.
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French consumer confidence was unchanged in November, figures from INSEE showed, though it remains a hair below the long-term average. INSEE's consumer confidence indicator was stable monthly at 99 points in November. The index's long-term average is 100. The indicator measuring the future personal financial situation, which looks at expectations for the next 12 months, slipped to minus eight points from minus seven points in October.
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Swiss economic growth came in lower than expected in the third quarter of 2021. Numbers from the State Secretariat for Economic Affairs showed Swiss gross domestic product increased 1.7% quarter-on-quarter in the three months to September. Growth slowed from 1.8% in the second quarter and undershot FXStreet-cited consensus of a 2% GDP hike. On an annual basis, GDP growth slowed to 4.1% in the third quarter, from 8.6% in the second. In the first quarter, the Swiss economy advanced 0.3%.
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The latest round of talks between the UK and EU aimed at resolving differences over Northern Ireland's post-Brexit arrangements will take place on Friday. UK Brexit Minister David Frost and European Commission vice-president Maros Sefcovic will meet in London to discuss potential changes to the Northern Ireland Protocol. The pair have had a regular series of meetings in recent weeks as talks have intensified over the dispute. A number 10 spokesman said: "They will meet again to discuss the Northern Ireland Protocol as we seek to try and reach consensus and agree a deal that can address the issues that we know people are facing on the ground." The UK has not ruled out the use of Article 16 of the protocol – unilaterally scrapping some of its rules – because of the impact on Northern Ireland.
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French Interior Minister Gerald Darmanin told UK counterpart Priti Patel on Friday he was scrapping planned weekend talks with her, in protest at a letter made public by Prime Minister Boris Johnson on the migrant crisis. In a message seen by AFP, Darmanin told Patel the letter from Johnson to President Emmanuel Macron suggesting France takes back migrants who cross the Channel was a "disappointment". Referring to Johnson's posting of the letter on social media, he added: "Making it public made it even worse. I therefore need to cancel our meeting in Calais on Sunday." France was planning to host ministers from all Channel littoral states, including Patel, for a crunch meeting on the migrant crisis in Calais on Sunday, after 27 migrants lost their lives this week off the French coast in the deadliest such disaster. A source close to Darmanin told AFP that the meeting would be going ahead with the ministers from other European countries but added Patel was no longer invited after Johnson's "unacceptable" letter.
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Washington will double compensatory and anti-dumping tariffs on Canadian lumber, a move long expected but that has nonetheless disappointed Ottawa and could further drive up prices in the US. Most Canadian companies that export softwood lumber to the US will have to pay 17.9% duties, up from the current 8.99%, according to documents from the US Commerce Department and the Canadian government. "Canada is extremely disappointed that the US has decided to increase to 17.9% the unfair duties it imposes on most producers of Canadian softwood lumber" and "calls on the US to put an end to it," said Canadian international trade minister Mary Ng in a statement. When contacted Thursday by AFP for comment, the US Department of Commerce did not respond.
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Retail sales growth in Australia topped consensus estimates in October, figures on Friday showed, as the sector got a boost from an easing of Covid-19 curbs. According to the Australian Bureau of Statistics, retail sales surged 4.9% in October from September, with growth coming in at almost double the market consensus estimate. According to an FXStreet-cited forecast, a 2.5% monthly climb was expected. In September, retail sales had risen 1.3% monthly. Annual growth accelerated to 5.2% in October from 1.7% in September.
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By Tom Waite; thomaslwaite@alliancenews.com
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