LONDON (Reuters Breakingviews) - Are global equities cheap yet? After two sharp corrections in February and October 2018, investors will be running their rules over stock-market valuations. They should be wary of falling victim to a value trap.
LONDON (Reuters Breakingviews) - Qatar has found a new way to irritate Saudi Arabia. Since June last year, the tiny gulf state of 2.6 million people has dealt with a hair-raising blockade by its neighbour with relative insouciance. Now it is equally nonchalantly leaving the Organization of the Petroleum Exporting Countries, the once all-powerful club of which Saudi is the de facto leader.
LONDON/PARIS (Reuters Breakingviews) - U.S. President Donald Trump’s Thanksgiving-week absolution of Mohammed bin Salman for the murder of journalist Jamal Khashoggi by Saudi agents has undermined any claims to global moral leadership by the U.S. administration. But America’s reputational loss today may benefit the Gulf in 2019.
LONDON (Reuters Breakingviews) - Call it the MbS discount. Since Jamal Khashoggi’s brutal murder by Saudi Arabian agents in early October, equity and bond prices in Riyadh have slumped. U.S. President Donald Trump’s indifference to Crown Prince Mohammed bin Salman’s alleged role in the journalist’s murder may offer a temporary lift for the Saudi market. But too many other problems lie in wait.
ABU DHABI (Reuters Breakingviews) - Epic natural-resource wealth, a ruling family becoming more progressive, and a pot of cash to invest in diversifying the economy. Until recently, asset managers looking for all that, plus Gulf exposure, would think first of Saudi Arabia. Ditto start-ups and governments attracted by the $45 billion pumped into SoftBank’s Vision Fund or $20 billion destined for a Blackstone infrastructure fund from the kingdom. With Riyadh’s reputation now crushed following the murder of journalist Jamal Khashoggi, Qatar may be their best alternative.
DUBAI (Reuters Breakingviews) - If Saudi Arabia was a corporation, its executive chairman would now consider replacing its chief executive, whose underlings have officially been accused of murdering an unarmed civilian in an overseas branch – the consulate in Istanbul. Saudi is not a company. It is an absolute monarchy, with a king and a crown prince rather than a chairman and CEO.
LONDON (Reuters Breakingviews) - The Wall Street tail is wagging the Washington dog. In the past, Saudi Arabia’s alleged involvement in the disappearance of journalist Jamal Khashoggi would have met with robust condemnation from the United States government. American banks and companies would then reluctantly pass up the chance to compete for lucrative business. But in the last few days a stream of luminaries headed by JPMorgan CEO Jamie Dimon have turned that dynamic on its head.
LONDON (Reuters Breakingviews) - Britain has taken the plunge. UK energy regulator Ofgem on Thursday outlined how it intends to cap energy consumers’ bills, after both main political parties advocated upper limits on what households pay. The whiff of interventionism warrants nervousness in domestic banks’ boardrooms.
LONDON (Reuters Breakingviews) - Britain is trying on its Brexit crash helmet. The UK government will on Aug. 23 reveal the first batch of contingency plans covering what happens if the country exits the European Union next March without a deal. The papers are unlikely to assuage many people’s concerns. What the government won’t say, however, is that it has a trump card.
LONDON (Reuters Breakingviews) - Investors in oil majors have a problem. The need to curb carbon emissions means that sometime in the next few decades demand for fossil fuels could peak, raising the risk that prices collapse and reserves lose their value. Shareholders need to decide whether to ask tougher questions, or carry on as normal.