Midday European briefing: stocks slip as if nothing had happened -2-

In the biggest war between European countries since World War II, death and destruction have no end in sight. Ukraine is still battling Russia’s advantage in raw firepower, but the country’s defenders are increasingly hitting Russian logistics and bases, including in Crimea, as they receive more Western weapons .

   
 
 

Eurozone Flash PMIs point to third-quarter GDP contraction

Eurozone business activity contracted in August for the second consecutive month after 16 months of growth, according to flash purchasing managers’ indices.

The S&P Global Eurozone Composite PMI fell to 49.2 in August from 49.9 in July, according to the flash reading.

   
 
 

Adidas management change may not be enough to fuel share price rally

Adidas AG’s decision to change chief executive should be welcomed, analysts say, although some warn that a rally in the share price may not come without more clarity on medium-term targets that look set to improve. increasingly out of reach.

The German sportswear major surprised the market on Monday by announcing that its boss, Kasper Rorsted, would step down next year. He will remain in office until then to ensure a smooth transition to his successor, the company said. The move was unexpected but positive given recent challenges, RBC Capital Markets analyst Piral Dadhania said in a note.

   
 
 

US warns Turkish companies against working with sanctioned Russians

ISTANBUL — The Biden administration has warned Turkish companies against collaborating with sanctioned Russian institutions and individuals, ratcheting up U.S. pressure on a NATO ally that maintained a strong relationship with Russia during its invasion of Ukraine.

In an Aug. 22 letter to the American Chamber of Commerce in Turkey and seen by The Wall Street Journal, Deputy Treasury Secretary Wally Adeyemo said Turkish companies risk facing U.S. sanctions if they do business. with sanctioned Russian people.

   
 
 

British Airways to cut more than 10,000 flights as industry problems threaten to spread over winter

LONDON-British Airways is cutting more than 10,000 flights over the remainder of the summer and winter flying season, threatening to extend the chaotic post-pandemic recovery of the aviation industry in Europe into next year.

The airline said it was reducing flights to comply with an extension of London Heathrow Airport’s cap on departing passengers. It also scaled back its flight schedule from November to March, consolidating same-day flights to destinations and offering to rebook affected passengers on other airlines depending on availability, he said. said in a statement Monday.

   
 
 

Ben & Jerry’s independent directors lose injunction claim over Israel business

A judge has dismissed a lawsuit filed by independent Ben & Jerry’s board members seeking to stop parent Unilever PLC from transferring assets to a local licensee in Israel – a setback for the ice cream brand in an unusual legal battle between a wholly-owned subsidiary and its owner company.

A judge in the Southern District of New York ruled on Monday that Ben & Jerry’s failed to show irreparable harm in its application for a preliminary injunction against Unilever. Earlier this month, Ben & Jerry’s board members asked the court to stop Unilever from making the transfer, arguing at a hearing that the move could allow the brand’s products to be used to oppose the social issues it supports.

   
 
 
   
 
 

WORLD NEWS

Flash warning for global economies of a sharp slowdown

Business activity in Europe and Japan fell in August, indicating a sharp slowdown in global economic growth, with rising prices weakening consumer demand and the war in Ukraine disrupting supply chains, according to new surveys.

Second month of declining activity in Europe comes amid renewed energy price hikes amid uncertainty over Russia’s willingness to maintain its already tight supply of natural gas ahead of the heating season .

   
 
 

Corporate carve-outs rebound after market turmoil

Private equity firm New Mountain Capital is snapping up a stake in manufacturer PerkinElmer Inc. for up to $2.45 billion in a type of deal that industry insiders s expect to see more in the coming months: an exclusion.

   
 
 

Endless demand pushes U.S. natural gas prices to shale-era highs

The 14-year highs reached this week by natural gas futures in the United States show the relentless demand for American shale gas across the Atlantic and likely indicate higher prices ahead.

The latest price spike came in response to Russian plans to shut down one of Europe’s main oil arteries for a few days at the end of the month. The closure announced on Friday is either the latest episode of unplanned maintenance along the vital Nord Stream gas pipeline or an act of economic warfare by Russia in retaliation for Western European support for Ukraine.

   
 
 

Chinese yuan slips to two-year low as economy stumbles and dollar soars

HONG KONG-CHINA’s currency fell to its weakest level against the US dollar in two years. It is likely to depreciate further as the country’s central bank struggles to combat the slowing economy and deep housing slump.

On Tuesday, the yuan was trading at over 6.86 to the dollar in the tightly controlled Chinese market, reaching levels last seen in August 2020, according to FactSet. The currency weakened past 6.88 in the more freely traded offshore market, taking its year-to-date decline against the dollar to more than 8%.

   
 
 

The US office glut began decades before the pandemic

A surplus of empty offices threatens to empty American business districts. Don’t blame the pandemic.

The office glut in the United States has been going on for decades, according to real estate investors, brokers and analysts. US developers have built too many office towers, lured by federal tax breaks, low interest rates and inflated demand from unprofitable startups. At the same time, owners have largely failed to demolish or convert the old, mostly vacant buildings to other uses.

   
 
 

Central Bank of Indonesia raises rates unexpectedly as inflation bites

Bank Indonesia unexpectedly raised its seven-day reverse repo interest rate in a preemptive move to tackle inflation which it says will continue to climb.

Indonesia’s central bank raised its benchmark interest rate by 25 basis points to 3.75%, against the expectations of eight economists polled by The Wall Street Journal, who had expected the bank to remain loyal.

   
 
 

Deepening Russia-Turkey ties raise concerns in the West over sanctions compliance

ISTANBUL-Turkey and Russia are tightening their economies, raising concerns among the United States and its allies that the budding relationship could undermine sanctions imposed on the Kremlin as punishment for its invasion of Ukraine.

The expansion of trade and financial ties shows how countries are looking to each other to shore up their struggling economies. Russia is increasingly leaning on Turkey to ease its international isolation after the West has imposed sweeping sanctions on Russia since its assault on Ukraine began in February. Turkish President Recep Tayyip Erdogan needs foreign currency amid an economic crisis largely stemming from his own monetary policy, economists say.

   
 
 

House Democrats fight for redistributed seats in New York primaries

Voters in Florida and New York head to the polls on Tuesday to decide primary races as well as a special House election in the Empire State that will test Democrats’ efforts to use access to the abortion to motivate their base.

Competitions in both states were heavily affected by the redistricting, which scrambled the plans of several Democratic House members in New York and endangered several incumbents, including Representatives Jerrold Nadler, Carolyn Maloney and Mondaire Jones. Additionally, Oklahoma voters will hold runoff elections in separate U.S. Senate races.

   
 
 

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This article is a text version of a Wall Street Journal newsletter published earlier today.

 

(END) Dow Jones Newswire

August 23, 2022 07:20 ET (11:20 GMT)

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