EUROPEAN MIDDAY BRIEFING: Share slump in China -2-

The spin-off of Universal Music Group by Vivendi SE, expected on Tuesday, will deprive the French conglomerate of its most lucrative business and test the market’s appetite for music as an asset class.

The world’s largest music company behind stars like Taylor Swift, Drake and the Beatles will debut on Amsterdam’s Euronext stock exchange with shares to be distributed to Vivendi investors. The move comes in response to increased interest in the resurgent music business as an investment and after a recent boom in the value of music catalogs, music streaming companies, and creator technology.

   
 
 

Shell begins manufacturing lower carbon jet fuel as regulations loom

Royal Dutch Shell PLC is the first major oil company to announce targets for the production and sale of low-emission jet fuel as airlines seek to buy more fuel in order to meet climate targets and stay ahead of proposed European Union regulations.

The Anglo-Dutch energy giant, a leading provider of aviation fuel, plans to produce 2 million tons of so-called sustainable aviation fuel annually by 2025, compared to none today. It wants SAF to account for at least 10% of the kerosene it sells by 2030, including fuel it sources from external suppliers. A Shell spokesman didn’t want to say how much SAF is being sold now.

   
 
 

Nigeria’s State Oil Company Established Under New Oil Law

Nigerian National Petroleum Corp., which has been a state-owned company since 1977. is to be founded as a company with a board of directors.

An official statement on Sunday said that Nigerian President Muhammadu Buhari, who is also the country’s petroleum minister, led the establishment provided for in the Petroleum Industry Act 2021.

   
 
 

Europe’s OVHcloud is preparing a potential IPO worth $ 4.7 billion

European cloud service provider OVHcloud plans to launch a potential IPO, the company announced on Monday, a deal that could value the deal at more than $ 4.7 billion.

OVHcloud, based in Roubaix, France, leases computing, storage and network capacity to users and monitors a network of dozen of data centers in North America, Europe, Singapore and Australia. In addition, the company operates its own fiber optic network worldwide, which the company claims provides a competitive advantage.

   
 
 

Investment firms Tiedemann and Alvarium are about to merge and are going through SPAC. to the stock exchange

The investment firms Tiedemann Group and Alvarium Investments Ltd. are on the verge of a merger and go public through a special purpose vehicle, said people familiar with the matter.

The joint investment firm would be called Alvarium Tiedemann Holdings and, as part of the deal with SPAC Cartesian Growth Corp. valued at around $ 1.4 billion, people said. The merger could be announced later this week.

   
 
 

US Spat with France shows challenge to keep allies united

France stepped up its opposition to a US security deal with Australia and Britain and criticized the Biden government‘s failure to keep its allies informed of comprehensive foreign policy initiatives after the pact resulted in the loss of a lucrative French submarine deal.

The French Foreign Minister Jean-Yves Le Drian discussed “the strategic consequences of the current crisis” on Sunday with his ambassadors from the USA and Australia who had been recalled for consultations. French President Emmanuel Macron is also expected to speak to President Biden in the coming days, officials from both countries say as a sign of France’s deep frustration with the security pact. Mr. Le Drian likened French anger over the security pact to the setback by American allies over the Biden government’s abrupt and chaotic withdrawal from Afghanistan.

   
 
 

Russia’s ruling party leads the polls while Putin tries to tighten control

The ruling MOSCOW-Russia party seemed well on its way to maintaining its majority in parliament, preliminary results showed, with a result that would consolidate President Vladimir Putin’s control over his country’s main levers of power.

The first balance sheet showed that the Kremlin-friendly United Russia won 50% of the votes cast, followed by the Communist Party of the Russian Federation with 20% and the Liberal Democratic Party of Russia with around 8%, according to the first results of the Russian Electoral Commission based on 85 % of the ballot papers were tallied.

   
 
 

Russia’s growing ties with Belarus are squeezing West-backed Ukraine together

The deepening integration of BRUSSELS-Russia with Belarus poses a new military threat to the West-backed Ukraine, which Moscow is trying to pull back under its spell.

Russia has carried out large joint military exercises with Belarus, whose authoritarian leader Alexander Lukashenko, weakened by mass protests and Western sanctions, has ceded much political and economic control over his country to Moscow. The exercises, which Russia says are defensive in nature and involve around 200,000 soldiers, showed closer military ties on Ukraine’s northern flank.

   
 
 
   
 
 

GLOBAL NEWS

More CFOs are adding sustainability goals to corporate loans

More and more companies are tying the interest rates on their corporate loans to environmental and other sustainability goals as investors and regulators put pressure on them to go green.

Sustainability-related loans have interest rates that adjust to whether a company is achieving a given environmental, social or governance goal, e.g. B. the reduction of CO2 emissions. According to Dealogic, a data provider, US companies borrowed $ 83.8 billion as of September 16, compared with $ 2.5 billion in the same period in 2020. US corporate credit, including sustainability-linked loans, totaled $ 1.7 trillion as of September 16, Dealogic said.

   
 
 

The sell-off in China’s real estate sector continues as Evergrande worries mount

Chinese real estate developer stocks continued to slide Monday as concerns increased that the China Evergrande Group is nearing a default, signaling the potential for wider contagion in the sector.

The Hang Seng Mainland Properties Index plunged more than 6.0% on Monday morning, a loss of 33% year-to-date. Evergrande fell 17% to HK $ 2.11 while Sunac China Holdings Ltd. down 10% and Guangzhou R&F Properties Co. down 7.3%. Property management companies also saw a decline, with Country Garden Services Holdings Co. down 12%.

   
 
 

The moderate beliefs of the RBA can be challenged by rising shipping costs

The Reserve Bank of Australia’s confidence that interest rates will not hike in the next two years is being tested as rising shipping costs and a weaker exchange rate push core inflation back to the 2% to 3% target in 2022.

Marcel Thieliant, chief economist at Capital Economics, said Monday that shipping costs from China to Australia are now around 250% higher than they were before the pandemic.

   
 
 

Business week ahead: central banks, home sales, purchasing managers

The Federal Reserve’s policy statement and Wednesday’s press conference by Chairman Jerome Powell highlight this week’s business news.

   
 
 

Democrats are pushing debt limit vote amid GOP stalemate

WASHINGTON – A party battle over raising the government’s credit limit is expected to intensify this week.

The stalemate has alarmed Wall Street analysts and business leaders, who over the past few weeks have warned of an increasing risk of technical default, where the government may not be able to make all of its regular payments in full and on time. The risk of such default could derail markets and affect US economic growth.

   
 
 

Junk debt sales rise towards record year

The $ 3 trillion low-rated corporate debt market is having its best year to date, fueled by a recovering economy and investor demand for additional returns.

U.S. companies like Crocs Inc. and SeaWorld Entertainment Inc. have sold more than $ 786 billion in junk-rated bonds and loans in 2021, according to S&P of S&P Global Market Intelligence. That surpasses the previous high for a whole year in data going back to 2008.

   
 
 

Covid-19 vaccinations boost the global economy but may not cure it on their own

The global recovery is slowing with the resurgence of Covid-19, causing governments to try to increase vaccination rates in hopes of stimulating stronger economic growth.

The thought is, first, that vaccinations alleviate consumer worries about infection and encourage them to spend more on travel, restaurants, concerts, and other activities that require being close to other people. Second, reduced Covid-19 case numbers would mean state ports, factories and other operations critical to global supply chains would be less closed.

   
 
 

Natural gas prices are rising and winter is still months away

Natural gas prices have risen, raising concerns about winter shortages and forecasts for the most expensive fuel since Fracker flooded the market more than a decade ago.

US natural gas futures ended Friday at $ 5.105 per million British thermal units. They were about half that six months ago and are up 17% this month.

   
 
 

While Congress debates trillions of dollars in spending, voters’ minds are elsewhere

FORT WAYNE, Ind.-Sen. Todd Young warned the few dozen conservatives who gathered in the basement of a sushi restaurant this month that their activism could be the only thing stopping Congress from spending trillions of dollars in taxpayers’ money.

“Flooding the Zone with your concerns will make members more aware of how serious they are,” said the Indiana Republican.

   
 
 

Afghan valley legendary for resisting the Soviets, Taliban emptying

BAZARAK, Afghanistan – Panjshiris are missing these days in the capital Panjshir, the only Afghan province to oppose the Taliban after the fall of Kabul last month.

   
 
 

Health experts are calling for patience with the wider use of Covid-19 booster vaccinations

(FOLLOW MORE) Dow Jones Newswires

Sep 20, 2021 6:25 AM ET (10:25 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.

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