Wednesday, April 27, 2016

Facebook Proposes New Stock Class to Solidify Mark Zuckerberg’s Control

Facebook, business, finance, economy

Facebook is making major moves to ensure its founder Mark Zuckerberg remains in charge of the company. On Wednesday the company proposed a new class of stock named as "C shares", this will allow Mr. Zuckerberg to maintain control of the company. The new class of shares will enable the chief executive to protect and keep his voting power at the company, even as he begins an effort to give away the majority of his stock for charitable purposes.

Facebook said the move was “not a traditional governance model,” but it added that “Facebook was not built to be a traditional company.”

The company also revealed their first-quarter earnings, sales shoot up 52% to $5.3 billion from a year ago, Profit also increased to $1.5 billion from $512 million a year earlier. The company's profit was 77% a share, far surpassing Wall Street expectations of 62 cents a share.

First Quarter 2016 Other Financial Highlights
  •     Mobile advertising revenue – Mobile advertising revenue represented approximately 82% of advertising revenue for the first quarter of 2016, up from 73% of advertising revenue in the first quarter of 2015.
  •     Capital expenditures – Capital expenditures for the first quarter of 2016 were $1.13 billion.
  •     Cash and cash equivalents and marketable securities – Cash and cash equivalents and marketable securities were $20.62 billion at the end of the first quarter of 2016.
  •     Free cash flow – Free cash flow for the first quarter of 2016 was $1.85 billion.

Tuesday, April 12, 2016

More Than 40,000 Verizon Workers Will Have A Strike

Verizon workers strike, Verizon

Verizon will have a pretty big headache when more than 40,000 Verizon workers are preparing to go on strike at 6 a.m. ET on Wednesday if they have not reached a new labor agreement with the company.

The Verizon workers who are mostly service their traditional phone business have gone without a contract since August, according to the Communication Workers of America. The union says they are doing everything to prevent Verizon from moving jobs offshore or cutting benefits for injured workers.

Verizon said that if the strike goes forward, the company is prepared to continue to serve its customers. It said that thousands of non-union workers have been trained to cover new assignments in the event of a strike.

Alibaba buys Controlling Stake in Southeast Asian Online Retail Giant Lazada for $1 billion

Alibaba, Lazada, Jack Ma

China based e-commerce titan Alibaba Group Holding Ltd said on Tuesday that they have agreed to buy a controlling stake in Southeast Asian online retailer Lazada to tap into the region's lucrative consumer market for about $1 billion. This will expand Alibaba's reach to the Southeast Asian market.

Under the deal worth approximately $1 billion which is Alibaba's biggest overseas investment so far, they will buy around $500 million worth of newly issued shares in Lazada, as well as acquire shares from some existing shareholders. These include Britain's biggest supermarket operator Tesco Plc, which said it would sell an 8.6 percent stake for $129 million, valuing Lazada at $1.5 billion. Rocket and Investment AB Kinnevik will also sell shares.

Alibaba President Michael Evans said the investment will support Alibaba's expansion plans in Southeast Asia.

Lazada Group was founded by Germany's Rocket Internet in 2012, their headquarters is in Singapore and they also operates in Malaysia, Indonesia, the Philippines, Thailand and Vietnam.

Alibaba and Lazada did not specify the size of the stake purchased but the sales imply a two-thirds holding.

The e-commerce market for business-to-consumer sales across all of Indonesia, the Philippines, Singapore, Malaysia, Vietnam and Thailand was just $10.5 billion in 2015, or 1.5 percent of retail volume, according to consultancy firm Frost & Sullivan. Just to compare, it accounts for 12% of retail in China, and 8% in the United States.

Thursday, March 31, 2016

Oil Prices is Down as U.S. crude stocks hit record for 7th week in a row

oil prices, economy, finance

Oil futures fell amid the rising U.S. crude stockpiles kept supplies at the highest level in more than eight decades. It renewed worries of global oversupply

Brent crude futures fell as much as 1.5% in New York after closing little changed Wednesday, 45 cents to $38.81 a barrel as of 0518 GMT. It ended up 12 cents in the previous session after touching a session peak of $40.61. U.S. crude futures dropped 53 cents to $37.79 a barrel.

Inventories expanded for a 7th week by 2.3 million barrels to 534.8 million barrels, according to a report from the Energy Information Administration. Imports and production dropped. Ecuador and Venezuela will support a cut to output at a meeting between major exporters in Doha next month, Ecuador’s Oil Minister Carlos Pareja said in a post on the ministry’s Twitter account.

But the increase was less than analysts' expectations of a 3.3 million barrel build after crude imports fell 636,000 barrels per day (bpd) to 7.4 million bpd.

Refinery crude runs rose by 414,000 bpd and refinery utilization rates rose 2 percentage points to 90.4 percent of total capacity, the highest seasonal rate since 2005.

Wednesday, March 23, 2016

U.S. Dollar is Up

U.S. Dollar, currency, Forex, economy, finance

U.S. Dollar were up to a one-week high against a basket of currencies on Thursday. The U.S. dollar index were able to hit 96.235, its highest since March 16. The U.S. currency was on the front foot after St. Louis Fed President James Bullard added his support to the possibility of more U.S. interest rate hikes this year.

U.S. Dollar was up 0.4% at 112.795 yen. The euro eased to $1.1171 EUR=, leaving it well off last week's top of $1.1342. Sterling GBP also slid to $1.4096 GBP= on concerns the attacks in Brussels would aid the campaign to leave the European Union in June's "Brexit" vote. The common currency has lost 0.8% so far this week.

Thursday, March 10, 2016

Gold Prices Ended Lower Ahead of ECB Meeting


Gold prices ended lower on Wednesday, as investors worries about this week’s European Central Bank monetary-policy meeting.  It is possible  that the European Central Bank might surprise markets by giving more stimulus than is expected, since expectations are unduly low.

Gold for April delivery closed down 0.4% at $1,257.40 a troy ounce on the Comex division of the New York Mercantile Exchange.

Most market watchers expect the central bank to ramp up its bond-buying program and push interest rates deeper into negative territory at the conclusion of their monetary policy meeting on Thursday.

China Shares Down Due to Weak Metals Prices, Steel Plant Concerns

trade, business, world business, finance

Shanghai Composite Index six-straight sessions of gains halted as China shares went down Wednesday amid concerns on metals prices and the consolidation of steel plants.

The Shanghai Composite Index loss about 1.4%, that ended their six-session winning streak, dragged by losses in basic materials and energy shares. The smaller Shenzhen Composite Index ended 2.1% down. Meanwhile, Hong Kong's Hang Seng was dragged to a 0.1% loss.   

South Korea’s Kospi rose 0.35%, and Australia’s S&P/ASX 200 gained 1%. In Japan, the Nikkei sold off for the second straight day, giving back 0.8% as a stronger yen weighed on major exporters again.

In China, shares of steel producers plunged after the official news agency Xinhua reported that the governor of Hebei, a northern province near Beijing, said the province aims to close 60% of its steel factories by 2020. That report sparked selling of steel-related stocks. Shanghai Hualian Mining was down 8.2%, and Shandong Jinling Mining lost 8%.