In the U.S.:
- Turmoil in Washington became a market concern this week as the Mueller investigation led to the FBI raiding the properties of Michael Cohen, President Trump’s personal lawyer. News reports out of the West Wing suggested that President Trump was outraged at the move and could seek to fire Deputy AG Rod Rosenstein.
Hilton Worldwide Holdings (HLT) announced the pricing of 60M shares on behalf of selling shareholder HNA Group at $73/share. In the past six months, HNA has sold or reached deals to sell more than $10B of investments, many of which it acquired over the past two years, as the company looks to rein in spending.
- Speaking at the Bo’ao Forum for Asia, President Xi Jinping stated that plans were under way to accelerate access to the insurance sector, expand the permitted business scope for foreign financial institutions and reduce tariffs on imported automobiles. The move helped quell some of the trade war fears that had previously hampered the financial markets.
- March CPI was up 2.1% y/y versus February’s 2.9% y/y reading. The CPI figures were expected to drop as February’s reading was driven by a spike in tourism and transport costs during the Spring Festival.
- A Reuters poll showed that Japan’s Q1 GDP likely stalled to 0.5% q/q annualized versus Q4’s 1.6% q/q reading. A slowdown in consumer spending and factory output were cited as the main catalysts to the slowdown.
Yanlord Land Group Ltd. and MCL Land Ltd. acquired Singapore residential property Tulip Garden for S$906.9M. Yanlord and MCL plan to redevelop the 316K sq. ft. property with up to 670 prime residential units.
- Investors sold Russian stocks, bonds and the ruble in the face of new American sanctions and a seemingly more fractured relationship between President Trump and Vladimir Putin. Due to both previous and new sanctions, the Russian economy continues to be economically isolated and faces risks to its long-term growth.
Pan European shopping center owner Klepierre announced this week that after being rebuffed twice, it had decided to abandon its takeover attempt of UK listed Hammerson Plc (HMSO). Klepierre disclosed in March that it had approached HMSO with a preliminary offer of 615 pence/sh, split equally in cash and stock. The offer was quickly dismissed by HMSO as inadequate. Klepierre increased its preliminary offer earlier this week to 635 pence/sh and was again dismissed quickly. HMSO is now left to pursue its December offer for UK peer Intu Plc. HMSO’s share price had experienced a significant fall since its offer for Intu, only to be lifted by Klepierre’s initial offer which although at a large discount to its estimated NAV/sh was still at 41% premium to its share price prior to the offer. HMSO’s unwillingness to consider Klepierre’s offer or engage in more serious negotiations is likely to frustrate many of its shareholders given a challenging retail environment in the UK.
The views expressed in this update are as of the date of this blog entry. These views and any portfolio holdings discussed in the update are subject to change at any time based on market or other conditions. The adviser disclaims any duty to update these views, which may not be relied upon as investment advice. In addition, references to specific companies’ securities should not be regarded as investment recommendations or indicative of the Adelante products, strategies, or portfolios.