Virtual certainty? Bankers ask if success of remote roadshows will last

HONG KONG/NEW YORK (Reuters) – Who needs expensive lunches at glitzy hotels and fancy restaurants to court investors for bond deals or the sale of new shares on the stock exchange?

In a world governed by quarantine and social distancing rules, even lead managers on multi-billion dollar deals have had to curtail travel and drop the personal touch in favour of video conferences and phone calls to woo potential investors.

Warner Music Group is one of more than a dozen companies that launched an initial public offering (IPO) in the aftermath of the COVID-19 pandemic and saw their shares soar on the first day trading.

“The wear from a virtual roadshow is much less than the wear and tear on the old normal roadshow. I was pleasantly surprised,” Warner Music Group chief executive Stephen Cooper said in an interview following this company’s IPO this week.

Some investors were also happy with the switch, because they saved time travelling to meetings with companies and their IPO advisers.

“When you meet face-to-face, you have to get everyone together into the lift, some people need to get their Starbucks… that one hour turns into one-and-a-half hours,” said Khiem Do, head of Greater China investments at Barings in Hong Kong.

All over the world, companies and their advisers have given up on the traditional multi-city investor roadshow – lasting up to two weeks – in favour of virtual sessions e investors that only last a few days.

So far the change has worked. U.S. IPOs excluding those of special purpose acquisition companies have yielded average gains of 35%, according to data firm IPOScoop. The S&P 500 Index has risen only around 6.6% in that period.

“In New York City you would normally do six or seven one-on-one meetings plus a group event. Boston is about the same. Now you can do at least nine in a day with no travel time,” said Taylor Wright, co-head of U.S. equity capital markets at Barclays Plc.

However, Wright and other bankers interviewed by Reuters questioned whether virtual roadshows will completely replace physical gatherings when the pandemic subsides. They said that many companies behind the IPOs of the last few weeks had warmed up investors in person before the pandemic, and younger companies may not be able to court investors only virtually.

For example, coffee producer JDE Peet’s raised 2.25 billion euros ($2.50 billion) in Amsterdam last week, in Europe’s biggest IPO of the year with a virtual roadshow that lasted just three days. It only managed to do so because the company and its advisers had already met in person with many potential investors, bankers on the deal said. [nL8N2DE0L9]

JDE Peet’s did not immediately respond to a request for comment outside business hours.

“If roadshows cannot carry on, I feel some investors won’t be willing to invest as happily,” said Zhenro Properties chief financial officer Kenny Chan, speaking in mid-May as the company raised $200 million via online roadshows in Asia’s first junk-rated bond for almost two months.

Many bankers and executives said they missed the social interaction, as well as the ability to ask questions quietly after in-person meetings.

Moreover, many of the IPOs that were successful in the last few weeks, including business intelligence platform ZoomInfo Technologies Inc and insurance policy comparison website SelectQuote Inc, were of well-established companies. Some IPO advisers cautioned that some startups and young less-known companies will struggle to pique investors’ interest without wooing them in person.

“Gathering in a hotel ballroom and listening to a roadshow presentation is just a different dynamic and vibrancy,” said Jocelyn Arel, a partner at law firm Goodwin Procter’s corporate and technology companies group

“I think it’s harder for startups, as they’re still trying to network remotely through video.”

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NetEase raises at least $2.7 billion in Hong Kong, more listings likely

HONG KONG (Reuters) – Chinese online gaming firm NetEase (NTES.O) raised at least $2.7 billion in a Hong Kong secondary offering, two sources said on Friday, amid doubts that mainland firms can list in New York as Sino-U.S. tensions deepen.

NetEase’s deal, the second after Alibaba (BABA.N) in 2019, is expected to be one of several large secondary deals in Hong Kong this year.

Its shares were priced at HK$123 ($15.87) each, the sources with direct knowledge of the matter told Reuters.

The company had planned to sell 171.48 million shares, according to an earlier term sheet, and has the option of selling another 25.72 million shares, under a so-called ‘greenshoe’ option.

The Hong Kong price is equivalent to $396.70 for NetEase’s U.S.-listed shares which is a 2% discount to the stock’s last closing price of $405.01 on Thursday.

Under the terms of the deal, one American depository receipt (ADR) is worth 25 of the company’s Hong Kong shares.

In its earlier regulatory filings, NetEase said it planned to use the money raised in its Hong Kong listing to fund its international expansion plans.

Charles Li, CEO of Hong Kong Exchanges and Clearing Ltd (0388.HK), said on Thursday he expected 2020 to be “a big year” for what he called “returnees” from U.S. markets.

The U.S. administration has questioned whether Chinese companies should be able to list in New York as tensions with Beijing rise.

“Today the atmosphere in the U.S. is becoming less friendly and we obviously have fundamentally changed many aspects of our listing regime so that we are becoming more accommodating,” he said via webcast at an industry conference held by Piper Sandler.

Chinese e-commerce company is due to launch its Hong Kong listing as early as Friday, according to sources with knowledge of the matter, to sell up to 5% of its stock to raise at least $3 billion.

Shares of Netease debut on June 11.

NetEase did not immediately respond to a request for comment.

($1 = 7.7501 Hong Kong dollars)

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Philippines' Duterte renews threat to kill drug dealers after big bust

MANILA (Reuters) – Philippine President Rodrigo Duterte renewed on Friday a threat to kill drug dealers after police seized 756 kg (1,667 lb) of methamphetamines, a haul he said proved the Southeast Asian country had become a transhipment point for narcotics.

The crystal methamphetamine, with a Philippine market value that police put at 5.1 billion pesos ($102.22 million), was one of the biggest seizures since Duterte unleashed his bloody war on drugs, which has defined his presidency, in 2016.

“If you destroy my country distributing 5.1 billion pesos worth of shabu … I will kill you,” Duterte said in recorded address, referring to the drugs.

He did not say where the drugs were believed to have come from but said the Philippines was a transhipment centre for Mexican drugs gangsters.

Duterte also hurled insults at human rights groups for criticising his anti-narcotics campaign.

The United Nations said in a report on Thursday tens of thousands of people in the Philippines may have been killed in the war on drugs amid “near impunity” for police and incitement to violence by top officials.

But government data put the number of suspected drug dealers and users killed in police anti-narcotics operations since July 2016 at 5,600.

Rights group have said the police summarily executed suspects. Police have denied that saying they have acted in self defence when suspects resisted arrest.

Duterte’s office dismissed the U.N. report as “rehashed claims” and the accusation of impunity as unfounded.

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Alok Sharma tests negative for coronavirus amid row over physical return to Commons

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Mr Sharma, Conservative MP for Reading West, could be seen using a tissue to wipe his brow multiple times whilst speaking in the Commons on Wednesday, At one point, Shadow Business Secretary Ed Miliband passed Mr Sharma a glass of water.

Mr Sharma announced his negative test result in a tweet yesterday.

He wrote: “Huge thanks to everyone for their really kind messages over the last 24 hours and my grateful thanks also to the parliamentary authorities and Speaker for their support yesterday. Just had my results in and my test for Covid-19 was negative.”

Labour’s Ed Miliband responded by saying: “Glad to hear this. Hope you are feeling better.”

The fact that Mr Sharma appeared unwell in Parliament raised some concerns regarding who he had been in contact with in the days prior.

The Business Secretary had had a 45-minute meeting with Prime Minister Boris Johnson and Chancellor Rishi Sunak the day before, though Number 10 said that the meeting had been “socially distanced”, the BBC reports.

Despite Mr Sharma’s negative test result, Daisy Cooper, Lib Dem MP for St Albans, warned that it was a “wake up call” for MPs and criticised plans to physically return to parliament

She wrote on Twitter: “Good news for Alok Sharma who has tested negative for Covid-19. This should still be a wake up call for Rees-Mogg.

“Govt should lead by example: support ppl2 [sic] work from home where they can (as per its own guidance), embrace digital & stop needlessly risking health of MPs & staff.”

Commons leader Jacob Rees-Mogg had proposed that the virtual parliament system should be scrapped.

Mr Rees-Mogg’s proposal led to a huge line of MPs snaking through the halls and courtyards of Westminster this week, and was passed by 261 votes to 163.
But the decision to return to parliament has been criticised by many MPs because of the Covid-19 infection risk it poses.

As well as the fact that it will mean that more MPs will be physically present around each other, the return to parliament will also see ministers travelling between Westminster and their constituencies – further increasing the risk of spreading the virus.

The virtual parliamentary proceedings had seen MPs vote online and contribute via video call.

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The decision to return to parliament has also faced criticism from those who are shielding and those from black and minority (BAME) ethnic backgrounds, the Guardian reports.

It follows a report by Public Heath England that people from ethnic minorities are at a higher risk of dying from Covid-19 than people from white ethnic groups.

Shadow Commons leader Valerie Vaz said: “We are twice as likely to die”, and added “please stop peddling the myth that we only work when we are here”, the Guardian adds.

And Shadow Secretary of State for Work and Pensions Jonathan Reynolds ridiculed the long line of MPs to vote on the motion to return to parliament, tweeting a photo of himself in the queue with the caption: “Genius level stuff this.”

But Rees-Mogg has defended his position, claiming that physical presence in the Commons and at voting procures is better for democracy.

He said is a Commons session: “voting whole enjoying a sunny walk or whilst watching television does democracy an injustice.

“We ask members to vote in person for a reason: because it is the heart of what Parliament is about.”

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Goldman Sachs executive's email making plea for racial equality goes viral at firm

(Reuters) – An email by a Goldman Sachs Group Inc (GS.N) employee about his experiences of racial injustice and criticizing managers at the Wall Street bank for not supporting junior bankers from diverse backgrounds went viral at the firm this week.

The email by Frederick Baba, a managing director at the bank who is black, coincides with other Wall Street executives and companies speaking out against racial inequality after the death of an African American man, George Floyd, during an arrest by a white police officer who held a knee on his neck in Minneapolis on May 25.

On Tuesday, Bank of America Corp (BAC.N) pledged $1 billion to help communities address economic and racial inequality. Goldman Sachs on Wednesday created a $10 million fund for racial equity. The CEOs of JPMorgan Chase & Co (JPM.N), Citigroup (C.N) and Wells Fargo & Co (WFC.N) have also made statements denouncing racism and discrimination.

Baba, who works in Goldman’s electronic trading business, according to his LinkedIn, initially sent the email with the subject line “How it’s going…” to a group of bankers he works with on June 2 after Floyd’s death led to sometimes violent protests across the United States.

But the letter ended up being so widely forwarded that it was seen by almost everyone at the bank – which employs around 38,000 people globally – including CEO David Solomon, according to a source familiar with the matter.

Solomon emailed Baba with a personal note in response, the person said without elaborating on what Solomon wrote. The letter has been posted on Goldman’s internal website, the person said.

“To everyone who’s asked me some variant of “how’s it going?” over the past month, I’ve probably lied. Or lacked the words to articulate it fully, but I’m giving it a shot,” Baba wrote in the email seen by Reuters.

“…the past few months have been demoralizing, and family/friends/colleagues I’ve spoken with and listened to across the firm and country seem to share this feeling,” he wrote, going on to mention minorities hard hit by the coronavirus pandemic.

Baba goes on to draw a detailed account of his experiences witnessing and being subjected to racial discrimination and aggression, including a 2011 encounter with Chicago police. Baba said the Chicago police slammed him against the hood of a cruiser because he matched the generic description of a black man wearing a t-shirt and shorts.

“I went home and I cried for the first time in years,” he wrote.

At the end of the letter, Baba calls on his colleagues to take action to counter racial inequality, including at work.

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  • 'How it's going …' Goldman executive's email on racial inequality in America

“A common bit of feedback from our junior colleagues is that while our firm expresses a commitment to equality and social justice up top, they don’t necessarily see commitment and support from their direct managers … I’ll be okay; look after them,” he wrote.

Reuters contacted Baba and Goldman Sachs on Thursday to verify the contents of the email. Baba referred Reuters to a spokesman for the bank because he is not authorized to speak to the press.

“Thanks for reaching out and creating a forum to discuss these critical issues,” he added.

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Trump on the brink as presidential campaign faced with MASSIVE challenges

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The US President has seen a disastrous 2020, with the COVID-19 pandemic, worsening relations with China and now protests after the death of George Floyd. Recent polling suggests that it is likely the incumbent Trump narrowly loses his presidency this November 3.

On Thursday, president Trump meet with top campaign advisers to strategise how he can recover from a series of national crises.

Trump sat down at the White House with campaign chairman Brad Parscale, White House chief of staff Mark Meadows, senior adviser Jared Kushner, Republican National Committee chair Ronna McDaniel, deputy campaign manager Bill Stepien and pollster Tony Fabrizio, among others.

A campaign official said that the president had a second, larger meeting with a broader group of campaign and RNC officials where he discussed attack lines for use on his likely opponent in the Nov. 3 election, Democrat Joe Biden.

The official said: “When Joe Biden is defined, the president runs very strong against him, especially in our target states.

“That’s something we’re going to work toward.”

President Trump was described as upbeat and engaged at the meeting.

However, one source familiar with his thinking said he has been frustrated as he struggles to respond to a crushing set of problems.

Trump on Friday canceled a planned weekend visit to his golf resort in Bedminster, New Jersey, an FAA advisory said, thus sparing him criticism about the optics of such a trip.

In recent weeks, the president had drawn criticism for his golf trips in the middle of Memorial Weekend.

In the meeting, Trump expressed a desire to engage more with the African American community, the campaign official said.

The official said: “The president was really engaged on that topic and wants to move the needle and talk to voters.”

The president has touted prison reform and funding for historically black colleges and universities as helpful for the community.

He has also called George Floyd’s death a “grave tragedy” and said he respected the rights of peaceful protesters, but faced criticism for not showing more empathy and a way forward for improving race relations.


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Trump has pushed a law-and-order theme in the wake of protests that grew violent last weekend.

Doug Heye, a former Republican National Committee official and frequent Trump critic, said: “As awful [seeing the protests worsen] is, it does allow Trump the opportunity to reframe the debate the way he wants it to be – law and order versus chaos.

“That is part of the conversation that he wants.”

It was also rumoured that the president would likely have run his campaign on the back of a strong economy, which saw the US GDP at it’s all time highest in 2019.

But since the coronavirus lockdown, more than 40 million people have been forced from their jobs, and the GDP has tanked.

Most public polls have recently put the president behind rival Joe Biden, which gives the presumptive Democratic nominee a lead nationally and in key battleground states.

But Trump has brushed aside polling in an interview with Fox News Radio’s The Brian Kilmeade Show.

He said: “I have other polls where I’m winning, and you’ve seen them too, I guess.”

In 2016, the national polling average had put Hillary Clinton at 45.9 percent and Trump at 42.8 percent, giving Mrs Clinton an 84 percent chance to win the presidency – Trump handily won the election that year, despite not winning the popular vote.

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Turkey to impose coronavirus curfews in 15 cities: Live updates

Weekend lockdown will be in effect in major Turkish cities including Ankara, Istanbul and Izmir.

  • Iran marked its highest daily jump since the beginning of the coronavirus outbreak with 3,574 coronavirus cases. The figures marked the third consecutive day that the country recorded more than 3,000 daily new infections.
  • Turkey is set to impose a weekend curfew in 15 cities to curb the spread of the virus. 
  • The coronavirus death tolls in Brazil and Mexico have soared to new daily records, with 1,349 and 1,092 confirmed fatalities, even as the countries begin to ease lockdown restrictions. Brazil now has more than 32,000 deaths, while Mexico has over 11,000.
  • Around 6.6 million coronavirus cases have been confirmed around the world, according to data from Johns Hopkins University. More than 389,000 people have died, including some 108,000 in the US. More than 2.8 million people have recovered from the disease.

Here are the latest updates:

June 5, Friday

01:22 GMT – Brazil’s death toll surges to third-highest in world  

Brazil’s death toll from the new coronavirus has overtaken Italy’s to become the third-highest in the world, according to official figures.  

The South American country of 210 million people reported a new record of 1,473 deaths in 24 hours, bringing its overall toll to 34,021, from 614,941 infections, the health ministry said.  

Italy has confirmed 33,689 deaths from 234,013 infections.

01:07 GMT – Fiji says all COVID-19 patients recovered

Frank Bainimarama, the prime minister of Fiji, said all coronavirus patients in the Pacific island nation have now recovered.

“And even with our testing numbers climbing by the day, it’s now been 45 days since we recorded our last case. With no deaths, our recovery rate is 100%” he wrote in a tweet.

00:42 GMT – Patients with high blood pressure ‘twice as likely to die’

Patients with high blood pressure admitted to hospital with coronavirus infections are twice as likely to die as those without the condition, according to a new study.

For in-patients with the virus who had stopped taking medication for high blood pressure, the risk of dying doubled again, they reported in the European Heart Journal.

“It is important that patients with high blood pressure realise that they are at increased risk of dying from COVID-19,” said senior author Fei Li, a cardiologist at Xijing Hospital in Xian, China.

The study also found that widely used drugs to control high blood pressure may help protect against severe COVID-19, allaying concerns that they could make the illness caused by the coronavirus worse.

00:15 GMT – Turkey to impose weekend curfew in 15 cities

Turkey will impose a two-day weekend curfew in 15 cities as part of efforts to prevent the spread of the novel coronavirus, the interior ministry said.

In a statement, the ministry said the lockdown will be in effect in Ankara, Istanbul, Izmir, Balikesir, Bursa, Eskisehir, Gaziantep, Kayseri, Kocaeli, Konya, Manisa, Sakarya, Samsun, Van and Zonguldak.

Markets, grocery stores and butcheries can operate during the lockdown, it added.

00:07 GMT – Argentina extends lockdown in Buenos Aires

Argentina extended until June 28 a mandatory lockdown in capital Buenos Aires and other areas with high cases of coronavirus, President Alberto Fernandez announced, after the country surpassed 20,000 confirmed cases earlier in the day.

Argentina’s lockdown, which was due to expire on June 7, has been in place since March 20, though officials relaxed restrictions in some areas of the country.

Hello and welcome to Al Jazeera’s continuing coverage of the coronavirus pandemic. I’m Zaheena Rasheed in Male, Maldives.

You can find all the updates from yesterday, June 4, here.

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China takes a victory lap over US protests

The US mass protests are raising eyebrows around the world, but China is watching with particular interest.

As anti-racism protests sweep across the US, Beijing has seized upon them to hit back at Washington for supporting last year’s Hong Kong pro-democracy demonstrations.

Chinese state media have given extensive coverage to the protests, highlighting the chaotic scenes and alleged police brutality in America to claim that China enjoys greater social stability.

Speaking to an international audience, Chinese diplomats are attempting to portray Beijing as a responsible global leader, standing in solidarity with other countries in condemning the racial disparity and injustice in the US.

‘A beautiful sight’

China’s state news agency Xinhua described the US civil unrest as “Pelosi’s beautiful landscape” – a reference to US House Speaker Nancy Pelosi’s comment last summer that the Hong Kong protests were “a beautiful sight to behold”.

State media Global Times’ chief editor Hu Xijin wrote that American politicians now can “enjoy this sight from their own windows”.

Beijing has long condemned American politicians, including Ms Pelosi, for “glorifying violence” coming from the Hong Kong demonstrators, who are categorised by China as “rioters showing signs of terrorism”.

Protests paralysed Hong Kong for most of last year, prompting Beijing to impose a new national security law in the territory in May, only two weeks ahead of the anniversary of the Tiananmen Square crackdown.

Aynne Kokas, senior faculty fellow with the University of Virginia’s Miller Center for Public Affairs, says that both the US and China are contending with a high level of domestic instability triggered by the global coronavirus pandemic and political events.

“Now is a key moment through which China is able to leverage the lack of stability in the US, in order to more efficiently promote its own national security goals,” she says.

Criticism over US applying ‘double standard’

Chinese and Hong Kong officials have also called out the US for applying “double standards” in its response to civil unrest.

“You know there are riots in the United States and we see how local governments reacted,” said Hong Kong’s leader Carrie Lam.

“And then in Hong Kong, when we had similar riots, we saw what position they adopted then.”

The officials’ view is shared by many Chinese social media users, who dub America “the double standard nation”.

Allegations of excessive use of police force during the US protests have been put under the spotlight by Chinese state media, to delegitimise Washington’s position on upholding freedom and democracy.

In one example, state broadcaster China Central Television reported on American journalists being pepper sprayed and a freelance photographer partially blinded by a rubber bullet while covering the protests.

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Georgia State University Global Communication Assistant Professor Maria Repnikova says that the scale and intensity of Chinese state media coverage on the US protests is unprecedented.

“It’s powerful, because they are not making it up,” Prof Repnikova says, but she points out that Chinese state media have cherry-picked the more peaceful pictures of Hong Kong police and the most violent ones from the US.

China itself has been heavily criticised for cracking down on press freedom, which is rarely mentioned by the government and state media.

On Weibo, many see America’s freedoms and democracy as at risk, as police fired tear gas at peaceful protesters and military was deployed to quell the protests.

Ms Kokas says: “Chinese state media don’t have to craft a narrative, they can just talk about the objective events that have happen in Washington DC, that undermines the very principal of freedom of speech and freedom of assembly.”

The US’s rhetoric about the democratic rights of Hong Kong now seems “very hollow”,she adds, “when military helicopters are flying over [Washington] DC”.

Chinese diplomats condemn US racism

The increasingly outspoken Chinese diplomats have seized the chance to spotlight the US’s governing failure and promote Beijing as a more responsible global leader.

Ms Kokas describes this as a continuation of the country’s propaganda strategy on the Covid-19 pandemic – when America fails, China is here to help.

Chinese diplomats on Twitter retweeted messages of UN and African Union officials, condemning racial discrimination and police brutality in the US.

The Chinese foreign ministry spokeswoman Hua Chunying tweeted “I can’t breathe”, with a screencap of the US state department spokeswoman Morgan Ortagus’ previous criticism over Beijing’s handling in Hong Kong.

But another of Hua’s messages denouncing anti-black racism backfired on Twitter, as she included “all lives matter”, a phrase often used to undermine the “black lives matter” movement.

Meanwhile, there are reports that African residents in the southern Chinese city of Guangzhou have been discriminated against and forced into quarantine during the coronavirus pandemic.

Beijing has not officially apologised for any mishandling, only stating that there were some “misunderstandings”.

One Weibo user expresses “disappointment”, as the person sees “some Chinese criticise others for racial discrimination, but when it comes to their own anti-black racism, they take it for granted”.

China is also accused of detaining hundreds of thousands of Uighurs and other Muslim minorities in high-security prison camps in its far western Xinjiang region.

Anti-America sentiment on the rise

There’s no doubt US protests have sparked heated discussion on Weibo – the topic is one of the most popular on the site this week. Related posts have earned more than 25 billion views.

Many Weibo posts “congratulate” the US for the civil unrest and push back at its support for the Hong Kong demonstrations.

One user writes: “The US government has been inflaming violence around the world, now the American people have finally woken up. The US government deserves this!”

And Beijing and its state media spread the theory that Washington was fomenting the protests in Hong Kong, calling it a “black hand” behind the unrest.

As US-China relations have soured due to the Hong Kong protests, trade conflicts and the pandemic, anti-America sentiment appears to be on the rise in China.

Thousands of Weibo comments describe the US protests as “karma” for Washington.

But some Chinese seem genuinely saddened by the situation.

“This is trampling on human rights! Democracy in the US came to an end at this exact moment,” a Weibo user commented under a video showing the CNN reporter getting arrested, receiving thousands of likes.

Many on Weibo also voice support for the civil rights movement. “Nothing much has changed after generations of fights. I hope this time will yield better results,” a comment reads.

Some Chinese also reflect on the weaknesses of their country.

One Weibo user writes about being “envious of the freedom of expression” in the US, as anti-government protests are often forcefully cracked down in China.

Some posts urge the state media to cover China’s domestic police violence and injustice with the same level of dedication.

But liberal voices are often met with harsh criticism.

State-affiliated yet liberal leaning newspaper Beijing News published a commentary advocating for empathy and respect for the American people, but it was quickly slammed as taking a “pro-America” stance and received tens of thousands of negative comments on Weibo.

Social media has always been an imperfect window to observe China’s public opinion. Its echo chamber effect is exacerbated by the country’s information censorship.

Prof Repnikova says that the relatively liberal views may become even more marginalised on Chinese social media, as cyber nationalism, a combination of bottom-up sentiments and top-down propaganda tactic, is increasingly dominant on the sites.

“The more aggressive, nationalistic and vocal voices are taking over the space,” she says.

Additional reporting by Yitsing Wang

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ECB sends euro higher, stocks pause after week-long rally

NEW YORK (Reuters) – The euro jumped to a 12-week high against the dollar on Thursday after another shot of European Central Bank stimulus to help economies slammed by the coronavirus pandemic, but world equity markets pulled in the reins after a strong seven-day run.

The euro rallied for an eighth straight session after the ECB said it would increase the size of emergency bond purchases by 600 billion euros ($674 billion) to 1.35 trillion euros, more than the 500 billion-euro increase analysts had expected.

A huge domestic support package from Germany also lifted the euro and briefly pushed European equities higher..

The single currency rose 0.83% to $1.1325 as the dollar index fell 0.516%. The euro has gained almost 4% as it advanced the past eight days.

Italy led a rally in southern European bond markets, with 10-year yields tumbling more than 15 basis points to 1.38% – their lowest since late March.

Spanish, Portuguese and Greek yields also fell, with the gap between 10-year Italian and benchmark German bond yields at its tightest since late March at around 170 bps.

ECB policymakers debated expanding their emergency bond purchases by between 500 billion euros and 750 billion euros before settling for a compromise figure, three sources told Reuters.

Euro zone bank stocks surged on the European stimulus, but equity markets slid as investors deemed recent optimism over an economic recovery – which drove the Nasdaq 100 to become the first U.S. equity index to reclaim its intraday record high set in February – as too much in too little time.

Money has been moving out of growth stocks into cyclicals, the economically sensitive companies that have been badly beaten up, such as airlines, hotels, casinos and financials, said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

The rally had been driven by hopes the economy will rebound as businesses reopen, which it will, but at different speeds for different industries, he said.

“There’s excessive optimism that everything is going to open up right way and it’s going to be fabulous. There’s some trepidation about that,” Ghriskey said.

A reminder of the economic travails will come on Friday with the Labor Department’s jobs report, which is expected to show the U.S. unemployment rate sky-rocketing to a historic 19.7%.

MSCI’s gauge of stocks across the globe shed 0.21% to snap a seven-day winning streak and the pan-European STOXX 600 index closed down 0.72%.

On Wall Street, the Dow Jones Industrial Average rose 11.93 points, or 0.05%, to 26,281.82. The S&P 500 lost 10.52 points, or 0.34%, to 3,112.35 and the Nasdaq Composite dropped 67.10 points, or 0.69%, to 9,615.81.

U.S. data also weighed on equities as exports dropped by a record 20.5% in April to a 10-year low.

Goods exports plunged 25.2% to $95.5 billion, the lowest since September 2009. Exports of motor vehicles and parts fell to $3.8 billion, the lowest since March 1992. Shipments of consumer goods dropped to $10.4 billion, the lowest since April 2006.

Market optimism about the post-pandemic recovery has reduced the dollar’s safe-haven appeal, as have widespread protests in the U.S. following the death of a black man in police custody.

The U.S. currency had began strengthening in overnight trading, pushing the Japanese yen to a two-month low of 109.150.

The Australian dollar dropped as much as 0.5% to $0.6884 after retail sales there plunged, although the country’s fourth stimulus package had helped shares gain.

The yield on benchmark 10-year Treasury notes rose 5.3 basis points 0.8135%.

Oil prices were little changed in choppy trade as investors awaited a decision from top crude producers on whether to extend record output cuts.

U.S. crude rose 12 cents to settle at $37.41 a barrel while Brent added 20 cents to settle at $39.99 a barrel.

U.S. gold futures settled up 1.3% at $1,727.40 an ounce.

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Tropical Storm Cristobal spaghetti models: When will storm hit Louisiana?

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Tropical Storm Cristobal is currently tearing across eastern Mexico and it is expected to emerge into the Gulf of Mexico late on Friday. The storm’s probability of making landfall in the US as a tropical storm remains likely according to WeatherTiger’s chief meteorologist. But when exactly is Cristobal due to hit Louisiana?

Tropical Storm Cristobal has battered Mexico with damaging and deadly flooding across portions of Mexico and Central America.

The storm is expected to produce additional extreme rainfall amounts through the end of the week.

The heaviest rainfall is anticipated across southern Mexico and portions of the Yucatan Peninsula, while also extending along the Pacific coast from Chiapas to Guatemala and El Salvador.

Residents across these regions have been warned the rainfall could produce widespread life-threatening flash floods and mudslides.


  • Tropical Storm Cristobal tracker: USA in path as storm strengthens

According to the most recent report from the NOAA’s National Hurricane Center issued at 10am CDT (4pm BST) has weakened to a depression but is continuing to produce heavy rains and life-threatening flooding.

The storm was located near longitude 17.6 north and latitude 91.0 west which is around 160 miles south-southwest of Campeche, Mexico.

Cristobal was moving at three mph and packing winds of 35mph.

The NHC’s report reads: “A turn toward the east and northeast is expected later today, and a subsequent northward motion should occur through Sunday.

“On the forecast track, the centre will move over the land mass of extreme northwestern Guatemala and eastern Mexico today and tonight.

“The centre is forecast to move back over the southern Gulf of Mexico Friday or Friday night, over the central Gulf of Mexico on Saturday, and approach the northern Gulf of Mexico coast Sunday and Sunday night.”

Weather forecasters forecast heavy rainfall will hit parts of Mexico through Saturday.

The Mexican states of Campeche, Quintana Roo, Tabasco, and Yucatan are likely to see between six and 12 inches, with isolated regions getting totals of 25 inches.

In addition, Veracruz and Oaxaca in Mexico are due to receive between five and 10 inches of rainfall.

Southern Guatemala and parts of Chiapas will see an additional 15 to 20 inches, with some regions getting up to 35 inches.

In El Salvador, an additional 10 to 15 inches is expected, whereas in Belize and Honduras three to six inches is anticipated with isolated areas getting up to 10 inches.

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Cristobal is forecast to emerge again over the southern Gulf of Mexico on Friday and move northward over the central and northern Gulf of Mexico over the coming weekend.

There is a risk of tropical-storm-force winds this weekend from Louisiana to the western Florida Panhandle.

In addition, there is a risk of dangerous storm surge from Louisiana to the Florida Big Bend.

These hazards, along with heavy rainfall, will arrive well in advance of and extend well east of the tropical storm’s centre.

Tropical storm and storm surge watches could be issued on Thursday night or on Friday.

According to spaghetti models, the storm is forecast to steadily track towards the US coast in Louisana in the coming days.

On Sunday at 7am CDT (1pm BST), the storm is expected to be located at latitude 26.7 north, longitude 90.6 west which is over water.

However, by Monday at 7am CDT (1pm BST), Cristobal is expected to be located inland in Louisana packing winds of 40mph.

The storm is expected to continue to track northwards arriving in Arizona on Tuesday with winds reaching 30mph.

Accuweather’s hurricane expert Dan Kottlowski said: “There is a small chance the system will break up over southern Mexico late this week, but the more likely scenario is for the storm to survive, move back out over the warm waters of the central Gulf of Mexico, reorganize, strengthen and turn northward toward the U.S. from Friday night to Sunday night.

“We’ve expected Cristobal to weaken to a tropical depression for a time over Mexico on Thursday.

He added the forward motion of Cristobal is expected to be slow at first but the system is likely to gain in speed later this weekend.

Mr Kottlowski said: “Provided Cristobal does not get beaten down too much by interaction with Mexico, there is a chance the storm strengthens to a hurricane over the central Gulf of Mexico later this weekend, prior to reaching the US.”

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