In the U.S.:
- Via twitter, President Donald Trump suggested that he will have the SEC look into changing the quarterly reporting cycle for public companies to a six month system. President Trump stated that the move would allow greater flexibility and save public companies money.
- In earnings, 465 companies in the S&P 500 Index have reported, 83.8% beat, 0.6% were in-line, and 15.6% missed estimates.
Bloomberg reported that MedEquities Realty Trust, Inc. (MRT) is considering a sale, according to people with knowledge of the matter. The company owns 33 acute-care hospitals, skilled nursing facilities and other types of health-care facilities in six states including California, and Texas.
In REIT earnings, 111 companies in the Wilshire U.S. REIT Index have reported, 77 beat, 10 were in-line, and 24 missed estimates.
- Trade communications with the US took a step forward this week with multiple media outlets reporting that a delegation led by Vice Commerce Minister Wang Shouwen will travel to Washington D.C. to resume trade talks. However, many are skeptical that any breakthroughs would come of the meeting as the participants lack policy changing authority and the Trump administration has not backed down from their plans to move on additional tariffs next week.
- Reuters cited comments from former BoJ official Hideo Hayakawa, who stated that the central bank may allow long-term rates to creep up to ~0.4% under the new guidance introduced last month. Hayakawa also added that the move laid the groundwork for “stealth” rate hikes.
CapitaLand Limited won the bid for two residential sites in Guanzhou, China for S$409M. CapitaLand plans to build up to 1,300 homes at the sites, which total 150K sq m.
- Eurozone Q2 GDP climbed 0.4% q/q which was the same pace of growth seen in the upwardly revised Q1 reading. The Q2 result will boost the ECB’s confidence in their decision wind down their asset purchases.
- Bloomberg reported that Turkish President Recep Tayyip Erdogan is reaching out to European trade partners to seek support in an effort to shore up the spiraling Turkish economy in the face of US sanctions. There was some relief as Qatar vowed $15B in investment which was overshadowed by US Treasury Secretary Steven Mnuchin, who stated that new sanctions were being prepared if Turkey failed to release pastor Andrew Brunson.
Deutsche Wohnen reported 2Q18 results this week with FFO I of €0.70/sh, an 11% increase YOY. The company reaffirmed its guidance for full year FFO I of around €470M, which appears slightly conservative given FFO I of €248.5M thru 6/30/18. Like-for-like rental growth was 4.5% overall, +5.3% in the greater Berlin market where it has the highest percentage of its residential portfolio. Total portfolio valuation increased 3.6% on a like-for-like basis, +4.6% for the greater Berlin market. EPRA NAV came in at €37.42/sh, a 4.7% increase since the start of the year. The company also announced the acquisition of 30 nursing facilities with €4,700 beds for a purchase price of €680M. The LTV at period end was ≈ 33.8% or ≈38% pro forma for the acquisition.
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.