US Business

European equities rose Monday in light pre-Christmas trade, rebounding gently from last week’s losses that followed bumper interest rate hikes, but Wall Street and Asian markets failed to get into the holiday spirit.

Equity markets often experience a so-called Santa rally, when prices rise during thin year-end trading dominated by small investors in a festive mood.

“Everyone, it seems, is waiting to see if Santa is going to come around, which leaves the market stuck between feelings of hope and angst,” said market analyst Patrick O’Hare at Briefing.com.

Major indices in New York were in the red most of the day and finished firmly lower, with the S&P 500 off 0.9 percent.

Michael Hewson at CMC Markets said that most investors are likely “content to sit on the sidelines with the main focus likely to be on this week’s core PCE inflation data and personal spending numbers for November which are due on Friday.”

But in Europe, stocks moved timidly higher.

Both Frankfurt and London rose 0.4 percent, while Paris added 0.3 percent.

“Markets are grinding higher as some traders are optimistic about valuations which seem to them somewhat attractive,” AvaTrade analyst Naeem Aslam told AFP.

“We really don’t have much volume in markets as traders are away for holidays,” he added.

“Overall I think it’s going to be pretty subdued trading, given the lack of significant data to react to,” noted analyst Susannah Streeter at stockbroker Hargreaves Lansdown.

Asian indices fell on lingering concern over a possible global recession caused by moves to fight inflation from top central banks.

Equities took a turn south last week after monetary policymakers around the world signaled that while price rises appeared to be stabilizing, more work would be needed to get them under control.

Adding to the downbeat mood was a spike in Covid-19 cases in China following the country’s reopening after almost three years of strict containment measures.

While the move is expected to boost the world’s number two economy, there is a worry that businesses and China’s health system will be hit in the near term.

Still, Beijing flagged a number of measures aimed at kickstarting growth next year, including support for the beleaguered property sector.

An expected pick-up in Chinese demand helped propel oil prices higher, as did plans by the United States to refill its strategic oil reserves.

– Key figures around 2040 GMT –

New York – Dow: DOWN 0.5 percent at 32,757.54 (close)

New York – S&P 500: DOWN 0.9 percent at 3,817.66 (close)

New York – Nasdaq: DOWN 1.5 percent at 10,546.03 (close)

London – FTSE 100: UP 0.4 percent at 7,361.31 (close)

Frankfurt – DAX: UP 0.4 percent at 13,942.87 (close)

Paris – CAC 40: UP 0.3 percent at 6,473.29 (close)

EURO STOXX 50: UP 0.2 percent at 3,811.24 (close)

Tokyo – Nikkei 225: DOWN 1.1 percent at 27,237.64 (close)

Hong Kong – Hang Seng Index: DOWN 0.5 percent at 19,352.81 (close)

Shanghai – Composite: DOWN 1.9 percent at 3,107.11 (close)

Euro/dollar: UP at $1.0610 from $1.0586 on Friday

Pound/dollar: FLAT at $1.2148

Euro/pound: UP at 87.31 pence from 87.14 pence

Dollar/yen: UP at 136.95 yen from 136.60 yen

West Texas Intermediate: UP 1.2 percent at $75.19 per barrel

Brent North Sea crude: UP 1.0 percent at $79.80 per barrel

burs-jmb/sst

Twitter users voted on Monday to oust owner Elon Musk as CEO in a highly unscientific poll he organized and promised to honor, just weeks after he took charge of the social media giant.

A total of 57.5 percent of more than 17 million accounts voted for him to step down. Musk, who is also the boss of car maker Tesla and rocket firm SpaceX, has not yet responded.

“The question is not finding a CEO, the question is finding a CEO who can keep Twitter alive,” the South African-born billionaire tweeted before the vote closed.

In a response to another tweet he added: “No one wants the job who can actually keep Twitter alive. There is no successor.”

Musk has fully owned Twitter since October 27 and has repeatedly courted controversy as CEO, sacking half of its staff, readmitting far-right figures to the platform, banning journalists and trying to charge for previously free services.

Analysts have also pointed out that the stock price of Tesla has slumped by one-third since the Twitter takeover and the share price briefly rallied by 3.3 percent on Monday before fading.

“It’s hard to ignore the numbers since [Twitter] deal closed,” tweeted investment expert Gary Black, saying he reckoned Tesla’s board was putting pressure on Musk to quit his Twitter role.

In discussions with users after posting his latest poll, Musk renewed his warnings that the platform could be heading for bankruptcy.

– ‘Won’t happen again’ –

Resorting to Twitter’s polling feature has been a favorite strategy of Musk’s to push through decisions, including the reinstatement of the account of former president Donald Trump.

Paris-based Reporters Without Borders, which defends the freedom of the press around the world, said the polls were a “crude and cynical” ploy.

“These methods appear to be democratic procedures, but in reality they are…the opposite of democracy,” said the group’s head Christophe Deloire.

The unpredictable entrepreneur posted his latest poll shortly after trying to extricate himself from yet another controversy.

On Sunday, Twitter users were told they would no longer be able to promote content from other social media sites.

But Musk seemed to reverse course a few hours later, writing that the policy would be limited to “suspending accounts only when that account’s *primary* purpose is promotion of competitors.”

“Going forward, there will be a vote for major policy changes. My apologies. Won’t happen again,” he tweeted.

The attempted ban had prompted howls of disapproval and even bemused Twitter cofounder Jack Dorsey, who had backed Musk’s takeover.

He questioned the new policy with a one-word tweet: “Why?”

– ‘Perfect storm’ –

Musk has generated a series of controversies in his short reign.

Analyst Dan Ives from Wedbush called his tenure a “perfect storm.” 

He flagged that “advertisers have run for the hills and left Twitter squarely in the red ink potentially on track to lose roughly $4 billion per year.”

Shortly after taking over the platform, Musk announced the site would charge $8 a month to verify account holders’ identities, but had to suspend the “Twitter Blue” plan after an embarrassing rash of fake accounts. It has since been relaunched.

On November 4, with Musk saying the company was losing $4 million a day, Twitter laid off half of its 7,500-strong staff.

Musk also reinstated the account of Donald Trump — though the former US president indicated he had no interest in the platform — and said Twitter would no longer work to combat Covid-19 disinformation.

In recent days, he suspended the accounts of several journalists after complaining some had published details about the movements of his private jet, which he claimed could endanger his family.

Employees of CNN, The New York Times and The Washington Post were among those affected in a move that drew sharp criticism, including from the European Union and the United Nations.

The Washington Post’s executive editor Sally Buzbee said the suspension of journalist Taylor Lorenz’s account “further undermines Elon Musk’s claim that he intends to run Twitter as a platform dedicated to free speech.”

Some of the suspended accounts have since been reactivated.

EU energy ministers on Monday overcame months of wrangling to agree a price cap for natural gas in the bloc, drawing an immediate warning from Russia that the move was “unacceptable”.

The price ceiling was fixed at 180 euros per megawatt hour, but with conditions attached and a word of caution from the European Commission that it may suspend the measure if “the risks outweigh the benefits”.

The aim of the cap on gas prices traded within the European Union is to mitigate an energy crunch brought on by Russia’s invasion of Ukraine.

EU countries are worried that they will have a hard time filling gas storage tanks in time for next winter.

Russia — before the war, the top exporter of gas to the EU — has turned off the taps in retaliation for a series of crippling sanctions against it designed to deplete its income used for its war.

The Kremlin has already said it won’t supply oil to countries applying a distinct EU embargo on its shipments of crude, and on Monday lashed out at the gas price cap.

“This is a violation of the market price-setting, an infringement on market processes, any reference to a (price) cap is unacceptable,” Kremlin spokesman Dmitry Peskov was cited as saying by Russian state-run news agencies. 

– Divisive issue –

The EU price cap will apply from February 15 and run for a year.

It will be triggered if the European benchmark price for natural gas futures goes above 180 euros per megawatt hour for three consecutive days.

That ceiling would then apply on trades for at least following 20 working days. For the cap to be deactivated, there has to be three consecutive days of trading below the 180-euro ceiling.

The mechanism is in response to high gas prices seen in Europe in August, which briefly soared to nearly 340 euros per megawatt hour, rattling EU governments.

The price of gas in Europe has since fallen, but remains historically high, and was trading at just under 112 euros per megawatt hour on Monday.

The gas price cap divided EU countries. 

Many said it was urgent to bring it in to force down energy costs. But others — led by economic powerhouse Germany — feared it could provoke suppliers of liquified natural gas (LNG) to snub Europe in favour of more lucrative Asian markets.

– Consequences –

The European Commission was also wary of the consequences of a price cap, and it initially proposed a ceiling of 275 euros and a two-week period above that number before it could be activated.

But that proposal met fierce objections from countries, such as Spain and Greece which made other broadly-backed energy measures — including joint gas purchases and speeded-up authorisations for renewable energy sources — contingent on a viable price cap.

Monday’s meeting saw Germany agree to the much lower price cap, and the much shorter triggering period to unlock the entire package.

“It wasn’t an easy thing to achieve,” Maltese Energy Minister Miriam Dalli said.

In acknowledgement of Germany’s concerns, a condition attached to the price cap is that futures prices for gas in Europe must to be at least 35 euros more than that paid for LNG on global markets.

EU energy commissioner Kadri Simson also said the European Securities and Markets Authority (ESMA) and the bloc’s Agency for the Cooperation of Energy (ACER) would present a “data report” on the likely consequences of the unprecedented price cap before it takes effect.

“The Commission stands ready to suspend ex-ante the activation of the mechanism, if an analysis from ECB (European Central Bank), ESMA and ACER shows that the risks outweigh the benefits,” she said.

France’s energy minister, Agnes Pannier-Runacher, said that, with the price cap agreed, attention must now turn to a longer-term reform of the EU’s energy market, notably unhitching the price of gas from that of electricity.

The Commercial Bank of Ethiopia said Monday that it has resumed financial services in some towns in the war-torn region of Tigray, enabling residents to access their funds after a shutdown lasting more than a year.

The announcement follows the signing of a peace deal between the federal government and Tigrayan rebels last month, aimed at ending the brutal two-year conflict and humanitarian crisis in northern Ethiopia.

“Following the peace agreement reached recently, the (CBE) branches we have in Shire, Alamata and Korem cities have started receiving money sent from abroad and locally as well as depositing money,” the country’s largest bank said in a statement.

“Our bank was forced to suspend its banking services because of the instability in the northern part of the country,” the statement said.

“Conditions permitting we will continue with our efforts to expand our services and step by step restart services in all branches.”

Access to northern Ethiopia is severely restricted and Tigray has been under a communications blackout for more than a year, making it impossible for journalists to independently verify the situation on the ground.

– Humanitarian disaster –

Since the November 2 peace agreement inked in South Africa, fighting between federal troops and the Tigray People’s Liberation Front has ceased, with the TPLF saying that 65 percent of its forces have “disengaged” from battle lines.

Earlier this month, the country’s electricity operator announced that the capital of Tigray had been reconnected to the national power grid after more than a year of cuts caused by the conflict.

The war left Tigray devastated and lacking access to basic services including banking, electricity, fuel and communications for more than a year.

Humanitarian aid has trickled into the north since the agreement but remains well short of meeting the population’s acute needs.

The death toll resulting from the war is unclear, but the International Crisis Group think-tank and Amnesty International have described it as one of the bloodiest in the world. 

All sides have been accused of abuses, while the United Nations says the conflict has displaced more than two million people and driven hundreds of thousands to the brink of famine.

The peace deal is aimed at ending the hostilities, disarming Tigrayan fighters, restoring federal government authority and reopening access to the region.

But the agreement makes no mention about the withdrawal of Eritrean forces, who have backed Ethiopia’s government during the conflict and been accused of horrific abuses.

Since the truce was agreed, the TPLF has regularly denounced Eritrean troops for allegedly committing human rights violations in Tigray.

According to the UN World Food Programme, more than 13 million people in northern Ethiopia now depend on humanitarian aid, including more than 90 percent of Tigray’s population of six million.

Prime Minister Abiy Ahmed sent troops to Ethiopia’s northernmost region in November 2020, accusing the TPLF, then the regional ruling party, of attacking federal army camps.

The TPLF dominated politics in the Horn of Africa nation for nearly three decades before Nobel Peace Prize laureate Abiy took office in 2018.

US industrial giant Honeywell will pay $160 million to settle criminal and civil probes in Brazil and the United States over bribes in order to win business from two national oil companies, the government said Monday.

Company officials offered about $4 million in payments to a former high-ranking Petrobras official between 2010 and 2014 to win a $425 million contract to design and build an oil refinery for the Brazilian petroleum giant, the Department of Justice said in a statement.

In exchange for the bribe, the Petrobras official provided “inside information and secret assistance” that enabled a Honeywell unit to win a contract from which it made $105.5 million in profits, the DOJ said.

“Honeywell UOP conspired to bribe a high-ranking official at Petrobras to win a contract from the company, effectively stifling competition,” said Michael Glasheen, an acting assistant director of the FBI Washington Field Office, which worked with agents in Brazil on the matter.

“Bribery schemes like this one transcend borders, and collaboration with our foreign partners is crucial to the fight against international corruption.”

About half of the $160 million in penalties went to settle a parallel civil case launched by the US Securities and Exchange Commission.

Besides the Petrobras matter, the SEC settlement also concerned charges that Honeywell in 2011 paid more than $75,000 in bribes to Algerian government officials to win business with Sonatrach, Algeria’s state-owned oil company.

Auction house Christie’s on Monday announced record sales of $8.4 billion in 2022, outshining its rival Sotheby’s, which also posted its best-ever result at $8 billion for the year.

Christie’s racked up $7.2 billion in auctions and another $1.2 billion in private sales, easily topping the $7.1 billion it made in 2021 as the art world emerged from the Covid-19 pandemic, which greatly hindered auction operations.

“In 2022, despite a challenging macro-environment, Christie’s has achieved our highest ever global sales,” chief executive officer Guillaume Cerutti said, referring to economic challenges sparked by inflation and the war in Ukraine.

He noted “the resilience of the art and luxury markets, the remarkable success of several major art collections — including the unforgettable Paul Allen sale — and the expertise and hard work of our teams around the world.”

Allen, the co-founder of Microsoft alongside Bill Gates, died in 2018. In 2009, he signed the “Giving Pledge” — a promise to donate the majority of one’s wealth to charity.

His extensive collection, spanning 500 years of art history, raked in a massive $1.6 billion. Five works went for more than $100 million each, including a Cezanne, a Van Gogh and a Gauguin.

And at a separate Christie’s sale in May, a famed Andy Warhol portrait of Marilyn Monroe — “Shot Sage Blue Marilyn” — sold for $195 million, setting a record for a piece of 20th century art.

– Who was buying? –

This year at Christie’s, buyers from North and South America accounted for more of total sales as compared with 2021 — 40 percent of the value versus 35 percent — while Asian buyers were on the decline.

Nevertheless, according to French billionaire Francois Pinault, whose holding company Artemis controls Christie’s, Asian buyers were “absolutely crucial” to the overall success of the Allen sale. 

The auction house said its banner year was fueled by a “new generation of collectors”: 35 percent of all buyers in 2022 were first-time clients, and 34 percent of them qualify as millennials.

Asia has the “fastest-growing base of new collectors,” Christie’s said. 

Cerutti noted that cars and real estate did not figure in the results.

Last week, Sotheby’s announced a year-end total sales projection of $8 billion, as compared with $7.3 billion in 2021. That data includes art and luxury items, but also homes and collector cars.

The auction house — owned by French-Israeli telecoms magnate Patrick Drahi — also noted that its client base in Asia was “rapidly expanding,” and that those collectors were “spending more per person on average than collectors from elsewhere.”