Connect with us

Reuters

Robinhood says it temporarily curbed buying of some securities as deposit requirement increased ten-fold

Online broker Robinhood, one of the hottest venues in this week’s retail-trading frenzy, said it put temporary buying restrictions on a small number of securities as clearing house-mandated deposit requirements for equities increased ten-fold.

Published

on

FILE PHOTO: The Robinhood App is displayed on a screen in this photo illustration January 29, 2021. REUTERS/Brendan McDermid/Illustration

(Reuters) – Online broker Robinhood, one of the hottest venues in this week’s retail-trading frenzy, said it put temporary buying restrictions on a small number of securities as clearing house-mandated deposit requirements for equities increased ten-fold.

“….the required amount we had to deposit with the clearing house was so large – with individual volatile securities accounting for hundreds of millions of dollars in deposit requirements – that we had to take steps to limit buying in those volatile securities to ensure we could comfortably meet our requirements,” it said in a blog post late on Friday.

Robinhood’s fee-free and simple-to-use app has made it popular with a new generation of small-time traders and its restrictions on Thursday drew a heavy backlash from high-profile politicians and celebrities.

Retail investors using Robinhood and other apps drove the so-called “Reddit rally” that pushed up shares of GameStop Corp and other companies championed on social media platforms including Reddit, resulting in heavy losses for big hedge funds that had shorted the shares.

Reporting by Rama Venkat in Bengaluru; Editing by Raju Gopalakrishnan

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up

Source: https://www.reuters.com/article/us-retail-trading-robinhood-deposits-idUSKBN29Z08Z

Reuters

Evergrande misses payment deadline, EV unit warns of cash crunch

China Evergrande’s electric car unit warned on Friday it faced an uncertain future unless it got a swift injection of cash, the clearest sign yet that the property developer’s liquidity crisis is worsening in other parts of its business.

Published

on

  • Evergrande misses payment deadline on dollar bond interest
  • Some bondholders have not been paid – sources
  • Company has 30-day grace period before the bonds default
  • PBOC injects cash into banking system; Evergrande shares fall

SINGAPORE/SHANGHAI, Sept 24 (Reuters) – China Evergrande’s electric car unit warned on Friday it faced an uncertain future unless it got a swift injection of cash, the clearest sign yet that the property developer’s liquidity crisis is worsening in other parts of its business.

Evergrande (3333.HK) owes $305 billion, has run short of cash and investors are worried a collapse could pose systemic risks to China’s financial system and reverberate around the world.

The company missed a payment deadline on a dollar bond this week and its silence on the matter has left global investors wondering if they will have to swallow large losses when a 30-day grace period ends.

China Evergrande New Energy Vehicle Group (0708.HK), meanwhile, said without a strategic investment or the sale of assets its ability to pay staff and suppliers and mass produce vehicles would be hit.

Evergrande’s silence on this week’s $83.5 million interest payment contrasts with its treatment of its domestic investors.

On Wednesday, Evergrande’s main property business in China said it had privately negotiated with onshore bondholders to settle a separate coupon payment on a yuan-denominated bond.

“This is part of the tactics of any sovereign-driven restructuring process – keeping people in the dark or guessing,” said Karl Clowry, a partner at Addleshaw Goddard in London.

“The view from Beijing is offshore bondholders are largely Western institutions and so can justifiably be given different treatment. I think people think it’s still a falling knife.”

China’s central bank again injected cash into the banking system on Friday, seen as a signal of support for markets. But authorities have been silent on Evergrande’s predicament and China’s state media has offered no clues on a rescue package.

“These are periods of eerie silence as no one wants to take massive risks at this stage,” said Howe Chung Wan, head of Asia fixed income at Principal Global Investors in Singapore.

“There’s no precedent to this at the size of Evergrande … we have to see in the next ten days or so, before China goes into holiday, how this is going to play out.”

Evergrande is expected to be one of the largest-ever restructurings in China and hopes are not high for a swift resolution.

The liabilities of China’s HNA group pale in comparison but its insolvency is still ongoing, with creditors seeking $187 billion, according to a source familiar the talks. On Friday, police seized both the HNA chairman and its CEO.

So far, there have been few signs of stress in money and credit markets as well as other areas that would signal that the crisis was spreading beyond China.

APPOINTS ADVISERS

Evergrande appointed financial advisers and warned of default last week and world markets fell heavily on Monday amid fears of contagion, though they have since stabilised.

The conundrum for China’s leaders is how to impose financial discipline without fuelling social unrest, since an Evergrande collapse could crush a property market which accounts for 40% of Chinese household wealth.

Residential buildings under construction are seen at Evergrande Cultural Tourism City, a project developed by China Evergrande Group, in Suzhou’s Taicang, Jiangsu province, China September 23, 2021. REUTERS/Aly Song

Protests by disgruntled suppliers, home buyers and investors last week illustrated discontent that could spiral in the event a default sparks crises at other developers.

China’s fragmented property market is showing some signs of strain, which could spur a wave of consolidation among real estate companies.

Capital Economics’ senior China economist, Julian Evans-Pritchard, said Evergrande’s crisis had had a much bigger impact on housing demand than he had anticipated, and households had turned much more cautious, triggering a drop in prices.

“I think Evergrande is going to have real issues. I don’t think the interest payment is going to be made,” Marc Lasry, CEO of Avenue Capital Group, said on CNBC Friday. Lasry said he had sold Evergrande’s bonds.

Global markets on Friday seemed rattled by the missed payment and regulatory silence.

PLAY FOR TIME

Some $20 billion of Evergrande’s debts are owed offshore while at home there are risks for China’s property sector and its liabilities spread across bank balance sheets and beyond.

There have been few signs of official intervention. The People’s Bank of China’s 270 billion yuan ($42 billion) cash injection this week is the largest weekly sum since January and has helped put a floor under stocks.

Bloomberg Law also reported that regulators had asked Evergrande to avoid a near-term default, citing unnamed people familiar with the matter.

The Wall Street Journal said, citing unnamed officials, that authorities had asked local governments to prepare for Evergrande’s downfall and distress is already evident among Evergrande’s peers.

Some banks, insurers and shadow banks have begun checks on their exposure to the troubled sector.

“We are concerned about the spillovers into the real economy and broader credit conditions,” said analysts at Societe Generale in a note. “The longer policymakers wait before acting, the higher the hard-landing risk.”

Analysts at BoFA Global Research, however, are among those who believe Chinese officials will be able to contain any Evergrande fallout.

“China has both the will and the tools to ring-fence a property crisis. Allowing the crisis to continue to escalate could threaten the key goal of social stability,” they said in a recent report.

Charts comparing Evergrande’s total assets, total liabilities and total borrowings .

Evergrande’s shares fell about 13% on Friday, while stock of its electric-vehicle unit (0708.HK) dropped 20% to a four-year low. Its bonds fell slightly and its offshore bonds with imminent payments due , last sat around 30 cents on the dollar and were thinly traded.

“It is clear now that Evergrande will make use of the 30-day grace period, to see if there is any further development or instructions from the government,” said Jackson Chan, assistant manager of fixed income research at research portal Bondsupermart.

($1 = 6.4589 Chinese yuan renminbi)

Reporting by Anshuman Daga and Tom Westbrook in Singapore, Andrew Galbraith in Shanghai and Kirstin Ridley in London. Additional reporting by Clare Jim in Hong Kong. Writing by Tom Westbrook; Editing by Jane Merriman, Jason Neely and Nick Zieminski

Our Standards: The Thomson Reuters Trust Principles.

Evergrande’s silence on this week’s $83.5 million interest payment contrasts with its treatment of its domestic investors.

Source: https://www.reuters.com/world/china/china-evergrande-bondholders-limbo-over-debt-resolution-2021-09-24/

Continue Reading

Reuters

UK seeks to break down digital trade barriers, says minister

Britain will look to break down digital trade barriers to help its businesses export their services, the country’s newly appointed trade minister Anne-Marie Trevelyan will say on Monday.

Published

on

Britain’s Secretary of State for International Trade Anne-Marie Trevelyan walks outside Downing Street in London, Britain, September 15, 2021. REUTERS/Hannah McKay/File Photo

LONDON, Sept 20 (Reuters) – Britain will look to break down digital trade barriers to help its businesses export their services, the country’s newly appointed trade minister Anne-Marie Trevelyan will say on Monday.

Britain’s Department for International Trade last week published a report seeking to predict trends in global trade out to 2050 which forecast that demand for digital services will double in the next decade.

“All of us depend on digital trade, yet British businesses face digital barriers in countries who take a protectionist approach,” Trevelyan will say in a virtual speech to London Tech Week, according to advanced extracts released by her office.

“I want the UK to break down these barriers and open up new, exciting opportunities for businesses and consumers so we can see improved productivity, jobs and growth.”

Trade deals typically focus on removing goods trade barriers, but since leaving the European Union, Britain has sought to include agreements on digital trade and common standards in professional services to spur service sector growth.

Trevelyan will use her first speech since taking up the role last week to set out the department’s plan to try to shape international digital policy. This will include establishing cooperation on digital trade via free trade agreements.

Enhanced consumer and intellectual property protections and promoting the development of digital trading systems such as e-contracting are also among the plans Trevelyan will set out.

The department, which said the digital sector contributed 150.6 billion pounds to the UK economy in 2019 and employed 4.6% of the national workforce, also wants to make it simpler and cheaper for businesses which use data to trade internationally by advocating free and trusted cross-border data flows.

Reporting by Kylie MacLellan; Editing by Nick Macfie

Our Standards: The Thomson Reuters Trust Principles.

“All of us depend on digital trade, yet British businesses face digital barriers in countries who take a protectionist approach,” Trevelyan will say in a virtual speech to London Tech Week, according to advanced extracts released by her office.

Source: https://www.reuters.com/world/uk/uk-seeks-break-down-digital-trade-barriers-says-minister-2021-09-19/

Continue Reading

Reuters

Brazil renews protection of little-seen Amazon tribe for six months

The only two known male members of the Piripkura tribe in Brazil live in isolation on ancestral lands the size of Luxembourg in the Amazon rainforest, resisting decades of invasion by loggers and cattle ranchers.

Published

on

An undated image of two male members of the Piripkura tribe during an encounter with a FUNAI (Indigenous National Foundation) unit before they returned to live in the Amazon forest, Rondonia state, Brazil. Survival International/Bruno Jorge/Handout via REUTERS

BRASILIA, Sept 17 (Reuters) – The only two known male members of the Piripkura tribe in Brazil live in isolation on ancestral lands the size of Luxembourg in the Amazon rainforest, resisting decades of invasion by loggers and cattle ranchers.

Brazil’s indigenous affairs agency Funai renewed a protection order on Friday for the 242,500-hectare (599,230-acre) area in western Mato Grosso state. But the renewed protection will last just six months, unlike the three-year extensions granted for the territory since 2008.

The Piripkura’s fate has become a test of indigenous rights under far-right President Jair Bolsonaro, who has criticized reservations for giving too much land to too few people and blocking the expansion of mining and farming.

Indigenous rights advocates had pressed for a three-year extension as in previous renewals. Advocate group Survival International called it a “stay of execution” by the government to gauge reactions before ending the protection altogether.

“We are still deeply concerned as the Piripkura’s future still hangs very much in the balance, while the landgrabbers are circling round and poised to invade,” said Fiona Watson, director of research and advocacy at Survival International.

The office of Brazil’s public prosecutor urged the government to renew protection orders that are about to expire for four groups of indigenous people. It said Brazil is the South American country with the largest number of indigenous people living voluntarily in isolation, with 114 groups sighted.

Federal prosecutor Ricardo Pael, who has been seeking a court-ordered extension in Mato Grosso, said it should be renewed until a final decision on making the Piripkura an official tribal reservation is taken by Funai.

SPORADIC ENCOUNTERS

The Piripkura men, Baita and nephew Tamanduá, have only been seen in recent years in sporadic encounters with Funai staffers. Unshaven, long-haired and naked, they quickly disappear back into the forest, where other Piripkura are believed to live.

Baita’s sister Rita Piripkura has been the men’s contact with the outside world since she emerged to marry into another tribe on the nearby Karipuna reservation.

“I’m worried they’ll be killed. There are lots of outsiders around there. They could kill them both and there won’t be anyone left,” Rita told Survival International in a recorded interview, recalling a massacre of her people years ago.

“White men arrived at dawn and killed everyone. They killed nine of us. My family escaped in a canoe,” she said.

In July, federal prosecutor Pael got a court injunction for the eviction of farmers from the Piripkura land, the most deforested territory of any isolated or recently contacted Amazon people. Police have not yet acted on the order.

Anthropologists say the uncontacted tribes of the Amazon cannot survive without their land and are increasingly pitted against armed invaders interested in poaching, farming and mining in their territory.

The invaders have become bolder since the 2018 election of Bolsonaro, who once praised Colonel George Custer in a speech for his role in clearing the U.S. prairies of indigenous people.

He is backing a bill in Congress that would limit indigenous land claims and help to open tribal reservations for commercial mining and plantations.

The public prosecutor’s office said in its statement that mining companies have 55 requests for prospecting licenses on Piripkura land that will be held up by the protection order for another six months.

Indigenous advocates worry that a failure to renew such orders would mean an eventual extinction of protected territories.

“It will be the end of the Piripkura,” said Fabricio Amorim, a former Funai employee now with OPI, an NGO advocating for the rights of isolated and recently contacted indigenous people.

Reporting by Anthony BoadleEditing by Brad Haynes and Rosalba O’Brien

Our Standards: The Thomson Reuters Trust Principles.

“We are still deeply concerned as the Piripkura’s future still hangs very much in the balance, while the landgrabbers are circling round and poised to invade,” said Fiona Watson, director of research and advocacy at Survival International.

Source: https://www.reuters.com/world/americas/brazil-renews-protection-little-seen-amazon-tribe-six-months-2021-09-17/

Continue Reading

Trending