Connect with us

World

Here’s why bank stocks are getting hit even after their earnings beat the Street

Published

on

Indeed, mortgage banking revenue tumbled for both J.P. Morgan and Wells Fargo. Trading was mediocre at Citigroup, while PNC saw declines in revenue and deposits. Trading widely was in line with estimates, but not blockbuster as many had figured considering all the market volatility in the first quarter.

Analysts had expected the industry to reap strong benefits from December’s corporate tax cut, which reduced the nominal federal rate from 35 percent to 21 percent and slashed the effective rate as well for most banks. Volatility also was expected to boost trading revenues, but results were uneven.

Bove has long railed against conventional wisdom that rising interest rates automatically would benefit banks, and he said Friday’s results validated that view.

“If you take these things and ask how is the core banking business doing, it isn’t doing. It’s not producing higher revenues, because it’s not producing more loans,” he said.

“The interest rate chatter led to an expectation of much higher results on a fundamental basis, and the chatter was always wrong,” he said. “It was wrong because interest rates do not drive bank earnings. What does drive bank earnings is what they sell.”

There also were some individual stories that held bank share prices after the earnings reports came out.

For Wells Fargo, it was a familiar nemesis: legal expenses related to the batch of scandals that has emerged over the past year and a half. The bank is under fire for the fake accounts fiasco as well as allegations of wrongdoing in its auto and home lending businesses.

That reality took the shine off results that otherwise appeared strong. The bank posted earnings of $1.12 a share, 6 cents better than analyst estimates.

“The … beat masked weakness across the bank with a tighter [net interest margin], smaller balance sheet, lower fee revenue, and higher operating expenses than expected,” said David Long, banking analyst at Raymond James. “We believe Street EPS revisions will be negative and expect deteriorating fundamental performance to continue to weigh on WFC shares.”

Long added that the higher-than-expected operating expenses were due to legal costs that were worse than thought.

To be sure, the reactions weren’t all negative about bank earnings.

J.P. Morgan’s trading softness came amid an otherwise “strong boost to the bottom line” from investment banking and markets, said Ana Arsov, managing director at Moody’s Investors Service.

“JPM had a credit positive first quarter with all franchises showing healthy customer engagement,” Arsov said. “This was also supported with particularly favorable performance in the consumer and retail bank on back of improved net interest margins due to higher rates, strong deposit growth and benign credit costs.”

However, Bove said broader issues are confronting the industry. The big players, he said, are going to have to adjust their business models to continue to gain investor confidence.

“For the vast majority of banks in the United States, they’re not selling anything,” Bove said. “If JPM can’t sell loans because nobody is interested in buying them, it means people are not buying products, it means the economy is not moving at a fairly rapid pace. All that stuff gets pulled into it. The bottom line is business is not good and that the stocks are not doing well.”

WATCH: Weak loan growth bedevils banks.

Source link

World

‘Schitt’s Creek’ sweeps, HBO wins big

Published

on

Emmy history was made on Sunday when Pop TV darling “Schitt’s Creek” swept the comedy category’s seven major awards during the 72nd Primetime Emmy Award Show, a first for the Hollywood event.

Catherine O’Hara and Eugene Levy took home the awards for best lead actress and best lead actress in a comedy series. Dan Levy and Annie Murphy won for best supporting actor and best supporting actress in a comedy. Dan Levy garnered the top prize for writing for a comedy series. He also won the award for best direction of a comedy alongside Andrew Cividino. The show took also home the prize for outstanding comedy series.

“Schitt’s Creek,” which aired its sixth and final season earlier this year, previously had not won any Emmy awards for the show. During the Creative Arts Emmys earlier this week, the show took home awards for best casting and best contemporary costuming.

With those acting wins “Schitt’s Creek” has become the first TV show to sweep all four acting awards in the comedy or drama categories in Emmy history. In total, the show’s nine Emmy wins breaks the record for most wins, which was previously held by “The Marvelous Mrs. Maisel” for its eight wins in both 2018 and 2019.

Premium cable network HBO dominated the limited series and drama categories, hauling in the majority of its awards for its critically-acclaimed shows “Watchmen” and “Succession.” Zendaya, who won for her work HBO’s “Euphoria,” is the youngest Emmy winner in the lead actress category at 24.

In total, HBO snagged 11 primetime Emmy awards, the most of any network for the night. 

Between the Creative Arts Emmys and the primetime Emmys, HBO won 30 trophies, the most of any network.

Netflix garnered two Emmy wins Sunday, bringing its total of wins to 21. VH1, Hulu and Apple each nabbed one primetime Emmy win a piece. Overall, Pop TV had the third-most wins with 10 and first-timer Disney+ tied for the fourth-most Emmy wins with NBC with 8 wins.

“Why would you have an award show in the middle of a pandemic?” Jimmy Kimmel asked rows of empty seats at the Staples Center as the show kicked off Sunday. In the tongue-in-cheek opener, the veteran host promised viewers an Emmy awards show like no other.

“No, seriously, why are we having an award show in the middle of a pandemic?” he asks as the team at ABC intercuts reaction shots and track laughter from previous Emmy ceremonies. “…What is happening tonight is not important. It’s not going to stop Covid. It’s not going to put out the fires. But it’s fun and right now we need fun. My God do we need fun. This has been a miserable year. This has been a year of division, injustice, disease, Zoom school, disaster and death.”

The event doesn’t have an audience or a red carpet. Instead, nominees have been sent their own camera kit to broadcast live from their living rooms as Hollywood doles out trophies to TV’s top talent in the first major entertainment industry ceremony since the coronavirus pandemic began. 

In total ABC shipped out 130 cameras to nominees in 20 cities and 10 countries. Winners gave their acceptance speeches and then were transferred over to a virtual press room to conduct quick press conferences with reporters.

For comparison, the Creative Arts Emmys, which took place last week, had pre-taped acceptance speeches from each nominee. Whoever won had their speech broadcast.

On Sunday, a number of winners reminded the audience to register and get out to vote in November during their speeches. Additionally, nominees and winners wore different T-shirts with slogans like “Vote,” “Remember Her Name” and “Black Lives Matter.”

Regina King (“Watchmen”) and Uzo Aduba (“Mrs. America”) paid tribute to Breonna Taylor, a 26-year-old African-American emergency medical technician who was fatally shot by Louisville Metro Police Department officers in March.

Taylor’s death, along with several other Black people who were killed by police, led to protests around the country in recent months. Her death is still being investigated and no one is facing any charges yet. However, last week the city of Louisville, Kentucky agreed to pay $12 million to Taylor’s family.

Damon Lindelof and Cord Jefferson, who won the best writing award for “Watchmen,” recognized the Tulsa Massacre in 1921 during their speech. The event, in which white residents violently attacked black residents and business, is featured heavily in the lore of the HBO show. 

Kimmel ended the telecast by telling viewers to “please vote.” 

Mixed in with celebrity presenters were a number of essential workers including health-care workers, farmers and postal workers. These pretaped segments focused on how these workers are aiding fellow Americans during the pandemic.

ABC is presented winners in the comedy category with Emmy trophies by sending people in tuxedo hazmat suits to nominees’ homes.

For the winner of best variety talk series and best competition show, ABC shipped black boxes to each of the nominees with the promise that only the person who won would find an Emmy inside.

Samantha Bee, who was nominated for “Full Frontal with Samantha Bee” and did not win, broke open her box to find a bottle of champange as a condolence prize.

And the winners are:

Lead Actress in a Comedy Series:
WINNER: Catherine O’Hara — “Schitt’s Creek” (Pop TV)
Christina Applegate — “Dead to Me” (Netflix)
Linda Cardellini — “Dead to Me” (Netflix)
Rachel Brosnahan — “The Marvelous Mrs. Maisel” (Amazon)
Issa Rae — “Insecure” (HBO)
Tracee Ellis Ross — “Blackish” (ABC)

Lead Actor in a Comedy Series:
WINNER: Eugene Levy — “Schitt’s Creek” (Pop TV)
Anthony Anderson — “Black-ish” (ABC)
Don Cheadle — “Black Monday” (Showtime)
Ted Danson — “The Good Place” (NBC)
Michael Douglas — “The Kominsky Method” (Netflix)
Ramy Youssef — “Ramy” (Hulu)

Writing for a Comedy Series
WINNER: Dan Levy — “Schitt’s Creek” (Pop TV)
Sam Johnson and Chris Marcil — “What We Do in the Shadows” (FX)
Tony McNamara — “The Great” (Hulu)
Stefani Robinson — “What We Do in the Shadows” (FX)
Michael Schur — “The Good Place” (NBC)
Paul Simms, “What We Do in the Shadows” (FX)
David West Read, “Schitt’s Creek” (Pop TV)

Directing for a Comedy Series
WINNER: Andrew Cividino and Daniel Levy — “Schitt’s Creek” (Pop TV)
James Burrows — “Will & Grace” (NBC)
Gail Mancuso — “Modern Family” (ABC)
Daniel Palladino — “The Marvelous Mrs. Maisel” (Prime Video)
Matt Shakman — “The Great” (Hulu)
Amy Sherman-Palladino — “The Marvelous Mrs. Maisel” (Prime Video)
Ramy Youssef — “Ramy” (Hulu)

Supporting Actor, Comedy
WINNER: Dan Levy  “Schitt’s Creek” (Pop TV)
Mahershala Ali — “Ramy” (Hulu)
Alan Arkin — “The Kominsky Method” (Netflix)
Andre Braugher — “Brooklyn Nine-Nine” (NBC)
Sterling K. Brown — “The Marvelous Mrs. Maisel” (Prime Video)
William Jackson Harper — “The Good Place” (NBC)
Tony Shalhoub — “The Marvelous Mrs. Maisel” (Prime Video)
Kenan Thompson — “Saturday Night Live” (NBC)

Supporting Actress, Comedy
WINNER: Annie Murphy — “Schitt’s Creek” (Pop TV)
Alex Borstein — “The Marvelous Mrs. Maisel” (Prime Video)
Betty Gilpin — “GLOW” (Netflix)
D’Arcy Carden — “The Good Place” (NBC)
Marin Hinkle — “The Marvelous Mrs. Maisel” (Prime Video)
Kate McKinnon — “Saturday Night Live” (NBC)
Yvonne Orji — “Insecure” (HBO)
Cecily Strong — “Saturday Night Live” (NBC)

Best Comedy Series
WINNER: “Schitt’s Creek” (Pop TV)
“Curb Your Enthusiasm” (HBO)
“Dead to Me” (Netflix)
“The Good Place” (NBC)
“Insecure” (HBO)
“The Kominsky Method” (Netflix)
“The Marvelous Mrs. Maisel” (Amazon)
“What We Do in the Shadows” (FX)

Best Variety Talk Series
WINNER: “Last Week Tonight With John Oliver” (HBO)
“The Daily Show With Trevor Noah” (Comedy Central)
“Full Frontal With Samantha Bee” (TBS)
“Jimmy Kimmel Live!” (ABC)
“The Late Show With Stephen Colbert” (CBS)

Best Actress in a Limited Series or a Television Movie
WINNER: Regina King — “Watchmen” (HBO)
Cate Blanchett — “Mrs. America” (FX)
Shira Haas — “Unorthodox” (Netflix)
Octavia Spencer — “Self Made” 
Kerry Washington — “Little Fires Everywhere” (Hulu)

Best Actor in a Limited Series or a Television Movie
WINNER: Mark Ruffalo — “I Know This Much Is True” (HBO)
Jeremy Irons — “Watchmen” (HBO)
Hugh Jackman — “Bad Education” (HBO)
Paul Mescal — “Normal People” (Hulu)
Jeremy Pope — “Hollywood” (Netflix)

Writing for a Limited Series, Movie or Drama Special
WINNER: Damon Lindelof and Cord Jefferson 
“Watchmen” (HBO)
Tanya Barfield — “Mrs. America” (Hulu)
Susannah Grant, Michael Chabon and Ayelet Waldman — “Unbelievable” (Netflix)
Sally Rooney and Alice Birch — “Normal People” (Hulu)
Anna Winger — “Unorthodox” (Netflix)

Directing for a Limited Series
WINNER: Maria Schrader 
“Unorthodox” (Netflix)
Lenny Abrahamson — “Normal People” (Hulu)
Steph Green — “Watchmen” (HBO)
Nicole Kassell — “Watchmen” (HBO)
Lynn Shelton — “Little Fires Everywhere” (Hulu)
Stephen Williams — “Watchmen” (HBO)

Supporting Actor, Limited Series or Movie
WINNER: Yahya Abdul-Mateen II — “Watchmen” (HBO)

Jovan Adepo — “Watchmen” (HBO)
Tituss Burgess — “Unbreakable Kimmy Schmidt: Kimmy vs. the Reverend” (Netflix)
Louis Gossett Jr. — “Watchmen” (HBO)
Dylan McDermott — “Hollywood” (Netflix)
Jim Parsons — “Hollywood” (Netflix)

Supporting Actress, Limited Series or a Movie
WINNER: Uzo Aduba —  “Mrs. America” (Hulu)

Toni Collette — “Unbelievable” (Netflix)
Margo Martindale — “Mrs. America” (Hulu)
Jean Smart — “Watchmen” (HBO)
Holland Taylor — “Hollywood” (Netflix)
Tracey Ullman — “Mrs. America” (Hulu)

Best Limited Series
WINNER: “Watchmen” (HBO)
“Little Fires Everywhere” (Hulu)
“Mrs. America” (FX)
“Unbelievable” (Netflix)
“Unorthodox” (Netflix)

Best Competition Series
WINNER: “RuPaul’s Drag Race” (VH1)
“The Masked Singer” (Fox)
“Nailed It” (Netflix)
“Top Chef” (Bravo)
“The Voice” (NBC)

Best Actor in a Drama Series
WINNER: Jeremy Strong — “Succession” (HBO)
Jason Bateman — “Ozark” (Netflix)
Sterling K. Brown — “This Is Us” (NBC)
Steve Carell — “The Morning Show” (Apple)
Brian Cox — “Succession” (HBO)
Billy Porter — “Pose” (FX)

Best Actress in a Drama Series
WINNER: Zendaya — “Euphoria” (HBO)
Jennifer Aniston — “The Morning Show” (Apple)
Olivia Colman — “The Crown” (Netflix)
Jodie Comer — “Killing Eve” (BBC)
Laura Linney — “Ozark” (Netflix)
Sandra Oh — “Killing Eve” (BBC)

Writing for a Drama Series
WINNER: Jesse Armstrong 
“Succession” (HBO)
Miki Johnson — “Ozark” (Netflix)
Peter Morgan — “The Crown” (Netflix)
Chris Mundy — “Ozark” (Netflix)
Thomas Schnauz — “Better Call Saul” (AMC)
John Shiban — “Ozark” (Netflix)
Gordon Smith — “Better Call Saul” (AMC)

Directing for a Drama Series
WINNER: Andrij Parekh  “Succession” (HBO)
Benjamin Caron — “The Crown” (Netflix)
Jessica Hobbs — “The Crown” (Netflix)
Mimi Leder — “The Morning Show” (Apple TV+)
Lesli Linka Glatter — “Homeland” (Showtime)
Mark Mylod — “Succession” (HBO)
Alik Sakharov — “Ozark” (Netflix)
Ben Semanoff — “Ozark” (Netflix)

Supporting Actor, Drama
WINNER: Billy Crudup  “The Morning Show” (Apple)
Nicholas Braun — “Succession” (HBO)
Kieran Culkin — “Succession” (HBO)
Mark Duplass — “The Morning Show” (Apple)
Giancarlo Esposito — “Better Call Saul” (AMC)
Matthew Macfadyen — “Succession” (HBO)
Bradley Whitford — “The Handmaid’s Tale” (Hulu)
Jeffrey Wright — “Westworld” (HBO)

Supporting Actress, Drama
WINNER: Julia Garner  “Ozark” (Netflix)
Helena Bonham Carter — “The Crown” (Netflix)
Laura Dern — “Big Little Lies” (HBO)
Thandie Newton — “Westworld”(HBO)
Sarah Snook — “Succession” (HBO)
Fiona Shaw — “Killing Eve” (BBC)
Meryl Streep — “Big Little Lies” (HBO)
Samira Wiley — “The Handmaid’s Tale” (Hulu)

Best Drama Series
WINNER: “Succession” (HBO)
“Better Call Saul” (AMC)
“The Crown” (Netflix)
“The Handmaid’s Tale” (Hulu)
“Killing Eve” (BBC)
“The Mandalorian” (Disney+)
“Ozark” (Netflix)
“Stranger Things” (Netflix)

Disclosure: Comcast is the parent company of NBCUniversal and CNBC.

Source link

Continue Reading

World

ByteDance says it will not transfer algorithm to Oracle

Published

on

The logos of the Chinese video portal TikTok and the US software and hardware manufacturer Oracle Corporation can be seen on a smartphone and screen on September 14, 2020 in Berlin, Germany.

Thomas Trutschel | Photothek | Getty Images

GUANGZHOU, China — ByteDance will not transfer algorithms and technologies to Oracle as part of a deal announced over the weekend to keep social media app TikTok operating in the U.S.

President Donald Trump said he approved a deal on Saturday that will see the creation of a U.S.-headquartered firm called TikTok Global with Oracle and Walmart taking minority stakes. Oracle will become TikTok’s secure cloud provider and host U.S. user data. 

But the deal does not entail any transfer of algorithms and technologies, according to a statement from ByteDance on Monday. The company said Oracle can instead check the source code. 

“The current plan does not involve the transfer of any algorithms and technologies. Oracle has the authority to check the source code of TikTok USA,” ByteDance’s statement said, according to a CNBC translation. 

Source code forms the basis for applications and software. Allowing inspections of source code is common practice to address local data security concerns. 

TikTok’s recommendation algorithm has been a key driver behind its growth, helping to suggest other videos to users and keep them hooked within the app. 

ByteDance also confirmed that it would do a small round of pre-IPO (initial public offering) financing. TikTok Global will become an 80% holding subsidiary of ByteDance as a result, giving it majority control. As part of the Oracle and Walmart deal, the companies said they would work toward a public listing in the U.S. within a year. 

Over the weekend, Trump said the new TikTok Global will “have nothing to do with any outside land, any outside country, it will have nothing to do with China. It’ll be totally secure. That’ll be part of the deal.” 

Beijing-based ByteDance’s majority ownership of TikTok appears to contradict that. But ByteDance is 40% owned by U.S. venture capital firms, so the Trump administration can technically claim TikTok Global is now majority owned by U.S. money.

Last month, as the TikTok deal appeared to be coming to a conclusion, China threw a spanner in the works by updating its list of technologies subject to export restrictions. One of the technologies on the list related to recommendation algorithms. After Beijing made this move, ByteDance said it would comply with the rules

Washington claimed that TikTok represents a national security threat because it collects American users’ data which could be accessed by Beijing. TikTok has repeatedly denied this and says it stores the data of Americans in the U.S. with a backup in Singapore. 

In August, Trump issued an executive order that would have banned transactions with ByteDance and effectively shut down TikTok in the U.S. That was set to come into effect on September 20. But the Department of Commerce said in a statement that it has delayed that by a week. 

Source link

Continue Reading

World

More restrictions likely in the coming days

Published

on

Pedestrians wear protective face masks while passing stores and cafes on Rue Montorgueil in Paris, France, on Wednesday, Aug. 26, 2020.

Bloomberg | Bloomberg | Getty Images

European countries are likely to impose more restrictions on public life in the coming days, analysts have said, as the number of daily coronavirus infections continues to rise rapidly.

“Expect lots more restrictions over the days and weeks ahead, especially in Europe,” Deutsche Bank analysts said in a note Monday. “The fact that the virus is already spreading quite rapidly is a big worry.”

France reported 10,569 new cases Sunday (down from more than 13,000 new cases reported the day before), Reuters reported, while the U.K., reported almost 4,000 new cases on Sunday. Italy saw close to 1,000 new infections and Germany reported 1,345 new cases Sunday, and a further 922 cases Monday. Spain is yet to post its weekend case tallies, but reported almost 4,700 new cases Friday.

On Monday, German Health Minister Jens Spahn said rising coronavirus infection numbers in countries like France, Austria and the Netherlands were “worrying” and that Germany would sooner or later import cases from there, Reuters reported. He added that countries like Spain had infection dynamics “that are likely out of control.”

Coronavirus cases are rising so rapidly in Europe that the World Health Organisation warned last week that there was a “very serious situation” unfolding in the region, calling the resurgence in infections a “wake up call.”  Local restrictions have been imposed in various parts of Europe to quell outbreaks of infection, with parts of northern England in lockdown, for example, as well as areas of Spain’s capital Madrid. 

As cases rise, however, more drastic measures are being considered, with the U.K. among those mulling whether to introduce a second, “mini” national lockdown to act as what has been described as a “circuit breaker” to stop the virus spreading. The country’s government is also considering more restrictive measures such as a 10.00 p.m. curfew that would force cafes, bars and restaurants to close early.

Economic hopes fading

Thankfully, the tally of fatalities caused by the virus are lower so far, and there is hope that a second wave of the virus will not see as large a spike in deaths as the first outbreak in spring, Deutsche Bank analysts led by Jim Reid noted. However, hopes that Europe’s economy could bounce back, with the recovery taking a “V” form, are looking increasingly unlikely.

“It doesn’t feel like fatalities are going to be as big as an issue as they were in the first wave but it really is hard to understand what the strategies of (European) governments are at the moment,” the analysts noted.

“They pretty much all don’t want a further wide scale lockdown but they also don’t want the virus to spread. Its not going to be easy to solve for both and as such it’s going to be a pretty difficult few months ahead if September is seeing numbers as high as they are already.”

The coronavirus developments have impacted European markets, with the pan-European Stoxx 600 index down 2% in early trade Monday. Rabobank strategists agreed that hopes of an economic bounceback were fading fast.

“With Coronavirus cases having surpassed the 31 million mark and almost 1 million deaths globally, the possibility that ‘second waves’ or indeed, first waves that were never actually brought under control will continue to weigh on the economic and policy outlook is all but certain, while earlier optimistic hopes for a ‘V’ (or perhaps even ‘W’) shaped recovery will continue to fade,” they said in a note Monday.

Economists at Capital Economics said they do not expect full, national lockdowns, and government ministers certainly appear reluctant to restrict economic activity as severely as before. But they warned that consumer confidence could take another hit as the public in Europe could be forced to curtail social activity and work from home again.

“While we do not expect the current second wave of coronavirus infections to lead to new national lockdowns, it will deal a blow to business and consumer confidence,” they noted Monday.

“Output looks set to remain below its pre-crisis level at least until the end of 2022, although there will be significant discrepancies between countries, with Germany set to fare substantially better than Italy or Spain.”

Source link

Continue Reading

Trending