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Amazon picks 2 sites for 2nd HQ; Home Depot Q2 earnings beat expectations

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Amazon picks 2 sites for 2nd HQ; Home Depot Q2 earnings beat expectations

TOP NEWS

* Amazon.com Inc. has picked New York City and Northern Virginia as the two bases for the e-commerce giant's next headquarters, The Wall Street Journal reported, citing people familiar with the matter. The sources said government officials in both locations are preparing for announcement events that are expected to take place as soon as Nov. 13. They would mark the end of a search that Seattle-based Amazon started in September 2017 and drew more than 200 proposals from cities and municipalities across North America.

* Atlanta-based home improvement retailer Home Depot Inc. raised its guidance again for fiscal 2018 after posting "record second-quarter sales and earnings" that exceeded analysts' expectations. The company updated its full-year diluted EPS outlook to $9.75, up from its previous estimate of $9.42. Home Depot said it now expects to report sales growth of about 7.2% for the full fiscal year ending Jan. 31, 2019, up from its previous guidance of a 7% increase. For the third quarter ended Oct. 28, net earnings rose 32.4% year over year to $2.87 billion, or $2.51 per diluted share, from $2.17 billion, or $1.84 per diluted share, in the year-ago period. The S&P Global Market Intelligence consensus estimate for net income excluding exceptional items was $2.59 billion.

MULTILINE RETAIL

* B&M European Value Retail SA reported revenue growth of 16.1% year over year, or 16% at constant currency, to £1.56 billion for the first half of 2019. Adjusted diluted EPS rose 14.3% year over year to 8 pence for the six months ended Sept. 29, in line with the S&P Global Market Intelligence consensus normalized EPS estimate compiled from two analysts. The company also raised its interim dividend by 12.5% to 2.7 pence per share, which will be paid Dec. 21.

E-COMMERCE

* Walmart Inc. said Flipkart Online Services Pvt. Ltd. CEO Binny Bansal tendered his resignation, effective immediately, following an investigation into "an allegation of serious personal misconduct," which the executive "strongly denies." "While the investigation did not find evidence to corroborate the complainant's assertions against [Bansal], it did reveal other lapses in judgment, particularly a lack of transparency, related to how [Bansal] responded to the situation," the retailer said in an SEC filing. Following Bansal's departure, Kalyan Krishnamurthy, CEO of the main Flipkart business, will now head the entire group, which includes online fashion retailer Myntra and Jabong.

* EBay Inc. teamed up with online home services platforms Handy, Porch.com Inc. and InstallerNet Inc. to provide installation and assembly services to its customers at checkout. The company also launched early access to its Black Friday shopping deals, which will be available until Nov. 18, with a guarantee to beat or match prices from rival retailers such as Walmart, Target Corp. and Costco Wholesale Corp.

* Tencent Holdings Ltd.-backed Chinese online travel service provider Tongcheng-Elong Holdings Ltd. launched an IPO in Hong Kong that could raise up to US$233 million, far below its previously reported target range of between US$1 billion to US$1.5 billion, Reuters reported, citing a term sheet. Tongcheng-Elong in June filed for an IPO. The company is now offering about 143 million shares at a price range of HK$9.75 to HK$12.65, which could give it a potential valuation of US$3.65 billion, according to the report.

* N Brown Group PLC said it expects irrecoverable value-added tax on marketing costs to increase between £6 million and £9 million annually beginning fiscal 2020 after a judge ruled that the e-commerce firm is not entitled to recover VAT on marketing costs. "The Judge agreed with [HM Revenue and Customs], finding that when the Group is marketing goods it is also in effect marketing financial services, even if there is no reference to this in its marketing materials," N Brown said. However, the judge also decided that VAT-exempt financial services income should exclude those that do "not relate to the original marketing activities" of the company, a ruling against HM Revenue and Customs' argument.

HOUSEHOLD AND PERSONAL PRODUCTS

* Beauty products retailer Coty Inc. announced the resignation of CEO Camillo Pane and the appointment of Pierre Laubies, former CEO of JAB Holding Co. Sàrl's coffee unit JDE, as his replacement, effective immediately. The company also said it started a board renewal process "to bring new perspectives to the company" and will add two new independent board members. In addition, Peter Harf was appointed chairman, replacing Bart Becht, effective immediately.

* Battery maker Energizer Holdings Inc. said Patrick Moore, who in January was appointed vice chairman of the Missouri-based company's board, was elected as its independent chairman, effective immediately. Moore succeeds Patrick Mulcahy, who will continue to serve as a member of Energizer's board of directors.

FOOD AND STAPLES RETAILING

* The Kroger Co.'s Columbus division agreed to raise its hourly minimum wage to $10 and to hike the pay to $11 after an employee completes one year of service, along with a premium increase for night-shift work. The decision is part of a new agreement with United Food and Commercial Workers Union, or UFCW, Local 1059.

HYPERMARKETS AND SUPERCENTERS

* Wesfarmers Ltd. acquired the advertising and content technology developed by Melbourne-based startup Unlockd Media Pty Ltd., which entered voluntary administration in June, The Sydney Morning Herald reported, citing a statement. The Australian food retailer company did not disclose financial terms of the deal, but the newspaper — citing Unlockd's recent creditors' meeting — said Wesfarmers paid A$1.3 million for the startup's intellectual property, business names and trademarks.

HOUSEHOLD DURABLES AND SPECIALTY RETAIL

* South Africa's Steinhoff International Holdings NV said a U.K. court approved the proposed scheme of arrangement of Stripes US Holding Inc., a direct subsidiary of its Steinhoff Europe AG unit, as part of the financial restructuring for Mattress Firm Holding Corp. Mattress Firm, which filed for Chapter 11 bankruptcy in October, is in the middle of a restructuring plan that calls for the closure of up to 700 stores. According to the sanction by the High Court of Justice in England and Wales dated Nov. 12, Stripes' scheme of arrangement with creditors is expected to occur on or about Nov. 19.

* LG Electronics Inc. CEO Jo Seong-jin plans to meet with Silicon Valley IT experts in a bid to recruit them to the company, Yonhap News Agency reported, citing a company statement. The South Korean firm reportedly said Jo's U.S. trip will also include meetings with Stanford University professors and artificial intelligence experts to discuss trends in the AI industry.

HOTELS, RESORTS AND CRUISE LINES

* Fosun Tourism Group, which operates holiday resort chain Club Med in France, received approval to list its shares on the Hong Kong Stock Exchange, the South China Morning Post reported, citing a person familiar with the matter. The Chinese company will be spun off from its parent, Fosun International Ltd., through an IPO that is expected to raise up to $1 billion.

CASINOS AND GAMING

* Tsogo Sun Holdings Ltd.'s board called off the deal to sell seven of its mixed-use casino properties to Hospitality Property Fund after it failed to receive sufficient shareholder support for the transaction worth 23 billion South African rand.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng rose 0.62% to 25,792.87, while the Nikkei 225 fell 2.06% to 21,810.52.

In Europe, around midday, the FTSE 100 rose 0.23% to 7,069.93, and the Euronext 100 gained 0.36% to 989.78.

On the macro front

The Redbook index for retail sales and the Treasury budget are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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