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Services companies in the U.S. and Asia gained ground in January, while a continued contraction in the eurozone threatened a double-dip recession, surveys of purchasing managers showed, the Wall Street Journal reported. The eurozone economy shrank in the final three months of last year amid high Covid-19 infection rates and related restrictions posed the risk of a double-dip recession. Surveys compiled by data firm IHS Markit released Wednesday showed the eurozone’s service sector fell to 45.0 from 46.4 in December.
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South Africa’s National Treasury will probably keep the levels of its bond auctions constant until the end of the fiscal year, even with domestic-debt issuance running ahead of target, Bloomberg News reported. The Treasury is unlikely to “adjust its in-year bond auction levels due to the short time period remaining after the presentation of the 2021 budget,” its media desk said Wednesday in an emailed response to questions, while emphasizing that the department “does not front-run the budget.” Finance Minister Tito Mboweni is due to present the national budget on Feb.
Bayer AG struck a $2 billion deal to resolve future legal claims that its widely used weedkiller Roundup causes cancer, the German company said on Wednesday, Reuters reported. Bayer has been struggling to finalize the settlement of claims that Roundup and other glyphosate-based herbicides cause non-Hodgkin’s lymphoma, a type of cancer. Bayer inherited the business and the litigation as part of a $63 billion acquisition of Monsanto in 2018. The company has said that decades of studies have shown Roundup and glyphosate are safe for human use.
Commerzbank AG’s restructuring plan echoes that of its biggest rival Deutsche Bank AG, but without the latter’s debt-trading profit engine to pull it through, Bloomberg News reported. The Frankfurt-based lender said late Wednesday that it expects to post a loss of about 2.9 billion euros ($3.5 billion) for 2020, reflecting lower asset values and the cost of cutting about 10,000 jobs. The loss exceeds the 2.7 billion euros that analysts had estimated, and stands in contrast to Deutsche Bank’s announcement Thursday of its first annual profit since 2014.
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The Bank of England has told British banks that they should take whatever steps are necessary to prepare their systems for negative interest rates, opening up a pathway for the central bank to use this additional policy tool to encourage more lending, the New York Times reported. But policymakers cautioned on Thursday that they were not trying to send the signal that rates would be cut to zero or lower imminently. The markets responded accordingly: The British pound and bond yields rose as traders pared back expectations for a future rate cut.
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Two British brothers are on the cusp of tying up the financing for their takeover of grocer Asda, the U.K.’s largest leveraged buyout in more than a decade, Bloomberg News reported. In a deal that could shake up Britain’s highly competitive grocery market, Zuber and Mohsin Issa and TDR Capital will pay less than a billion pounds of their own money to gain control of Asda in a transaction valuing the country’s third-largest grocer at 6.8 billion pounds ($9.2 billion). The Issas and TDR struck a deal with Walmart Inc. to take control of Asda in October, with the U.S.
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Brazilian miner Vale agreed Thursday to pay $7 billion in compensation to the state of Minas Gerais where the collapse of its dam two years ago killed 270 people, polluted rivers and obliterated the surrounding landscape, the Wall Street Journal reported. The settlement, the biggest in Brazilian legal history, is a watershed moment for a country long hampered by impunity and where miners and big businesses have often exerted more power than the state, especially in rural areas.
Better operating numbers and lower write-downs saw Singapore Airlines report a lower loss in the third quarter compared with the previous three months, the Straits Times reported. The carrier racked up a net loss of $142 million for the three months to Dec. 31 compared with a net profit of $315 in the same period in 2019. However, the latest figures were a significant improvement on the massive $2.34 billion loss in the July-September period. Those second-quarter results were also marked by huge impairment write-downs in the wake of the Covid-19 pandemic.
Laurentian University owes three Canadian banks C$91 million ($71 million), according to documents in a bankruptcy filing that one analyst says will be a test case for how the country’s schools deal with growing financial pressures, Bloomberg News reported. The Sudbury, Ontario-based university requested court protection under the Companies’ Creditors Arrangement Act on Monday, citing widening deficits, declining enrollment and costs related to the pandemic.
If India’s Future Group cannot sell assets, $4 billion in bank loans and debentures will be at risk, pushing its retail unit into insolvency, the company said in a court filing on Wednesday against Amazon.com Inc., which wants to block the sale, Reuters reported. A court in New Delhi blocked Future Group’s sale of retail assets to Reliance Industries on Tuesday after Amazon raised objections to the deal. The corporate battle has embroiled sprawling businesses led by two of the world’s richest men: Amazon’s Jeff Bezos and Reliance’s Mukesh Ambani.
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