News Archive


Investors eye Elliott’s Plan B as BHP shake-up push falters


LONDON/SYDNEY Two weeks after Elliott Management’s surprise assault on BHP Billiton, the fund manager’s three-point demand for change is gaining little traction with investors, prompting expectations a second strike is imminent.

While Elliott is struggling to push through a $46 billion overhaul of the Anglo-Australian miner, investors said it could point to BHP’s plans for further sales of marginal assets and increasing shareholder returns as, potentially, some incremental victories.

“I think the case for agitating for management to do what a shareholder wants is always there,” said Neil Boyd-Clark, portfolio manager at Arnhem Investment Management, a long-time holder of BHP’s Australian shares.

“In a way, this might be presented as being this great scary exercise, but there is a win-win-win for everyone involved.”

Over the past year, Elliott has built up a minority stake in BHP and earlier this month told the company it had failed to deliver “optimal” value.

It demanded BHP spin off U.S. oil assets, ditch a corporate structure built on dual listings in London and Sydney and hand back more money to shareholders.

In a swift rebuff, BHP said the costs of the changes would outweigh the benefits.

BEEN THERE, DONE THAT

Investors have been skeptical. Since the announcement, BHP’s London shares have fallen nearly 6 percent against a 0.8 percent drop on the FTSE 100. At Wednesday’s close, BHP’s Australian shares had dropped 2 percent against a 0.9 percent rise in the broader market.

“The fact that the share price did nothing indicates to me that the probability the market puts on them succeeding is essentially zero,” said a top-10 investor in the London shares.

Mining companies have come under intense pressure from shareholders since the end of the commodity boom in 2012, which left many investors nursing the painful after-effects of rash spending and costly acquisitions.

The downturn means many of Elliott’s ideas had already been tested within BHP, said major investors questioned by Reuters, none of whom said they had been contacted by Elliott.

BHP’s reliance on commodities also limits how much value could be unlocked from the sort of financial engineering proposed by Elliott, they said.

But a BHP statement on Wednesday showed room for movement, investors and analysts said.

In a break from a usually dry production statement, BHP Chief Executive Andrew Mackenzie said the miner had already been “fundamentally restructured” to increase returns with the demerger of South32 in 2015, the removal of layers of management and change in its approach to capital management.

The group also announced it would put its Fayetteville shale gas assets in the United States back on the market.

BHP has said there is no connection between these measures and Elliott’s demands.

Mackenzie is due to provide an update on strategy at a mining industry conference in Barcelona next month.

NEXT STEPS

Investors said one target for a second strike by Elliott could be BHP’s next major executive appointment – a new chairman. Incumbent Jac Nasser has said he will not seek re-election at this year’s annual general meeting.

“Who is going to take over replacing Jac Nasser is obviously going to be the key thing for investors this year,” said Andy Forster, portfolio manager at Argo Investments, a shareholder in BHP’s Australian arm.

Still, a source familiar with the situation said Elliott had not offered views on the board or management team in eight months of private talks with BHP before it went public.

Since its April 12 demands, Elliott has not made any statements about BHP although it promised further details in due course. An Elliott spokesman declined to comment.

On April 10, Elliott said it held about 4 percent of the London-listed shares, short of the 5 percent needed to call a shareholders’ meeting.

(Additional reporting by Barbara Lewis and Maiya Keidan in London, and Michael Flaherty in New York; Editing by Clara Ferreira-Marques and Neil Fullick)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/LUpzMAkz5Ro/us-bhp-billiton-elliott-idUSKBN17T11X

Trump tells Canada, Mexico, he won’t terminate NAFTA treaty yet: White House


WASHINGTON U.S. President Donald Trump told the leaders of Canada and Mexico on Wednesday that he will not terminate the NAFTA treaty at this stage, but will move quickly to begin renegotiating it with them, a White House statement said.

The announcement came after White House officials disclosed that Trump and his advisers had been considering issuing an executive order to withdraw the United States from the trade pact with Canada and Mexico, one of the world’s biggest trading blocs.

The White House said Trump spoke by telephone with Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau and that he would hold back from a speedy termination of NAFTA, in what was described as a “pleasant and productive” conversation.

“President Trump agreed not to terminate NAFTA at this time and the leaders agreed to proceed swiftly, according to their required internal procedures, to enable the renegotiation of the NAFTA deal to the benefit of all three countries,” a White House statement said.

“It is my privilege to bring NAFTA up to date through renegotiation. It is an honor to deal with both President Peña Nieto and Prime Minister Trudeau, and I believe that the end result will make all three countries stronger and better,” Trump was quoted as saying in the statement.

The Mexican and Canadian currencies rebounded in Asian trading after Trump said the U.S. would stay in NAFTA for now. The U.S. dollar dropped 0.6 percent on its Canadian counterpart and 1 percent on the peso.

The White House had been considering an executive order exiting NAFTA as early as Trump’s 100th day in office on Saturday, but there was a split among his top advisers over whether to take the step.

During his election campaign Trump threatened to renegotiate NAFTA and in the past week complained bitterly about Canadian trade practices.

It was under an executive order signed by Trump on Jan. 23 that the United States pulled out of the sweeping Trans-Pacific Partnership trade deal.

News of the potential presidential action to withdraw from NAFTA earlier drove the Mexican and Canadian currencies lower.

NAFTA TRADE HAVOC

“To totally abandon that agreement means that those gains are lost,” said Paul Ferley, an economist at Royal Bank of Canada.

Trump has repeatedly vowed to pull out from the 23-year-old trade pact if he is unable to renegotiate it with better terms for America. He has long accused Mexico of destroying U.S. jobs. The United States went from running a small trade surplus with Mexico in the early 1990s to a $63 billion deficit in 2016.

Details about the draft executive order on NAFTA were not immediately available.

Trump has faced some setbacks since he took office in January, including a move by courts to block parts of his orders to limit immigration.

Withdrawing from NAFTA would enable him to say he delivered on one of his key campaign promises, but it could also hurt him in states that voted for him in the election.

“Mr. President, America’s corn farmers helped elect you,” the National Corn Growers Association said in a statement. “Withdrawing from NAFTA would be disastrous for American agriculture.”

DIVERGING OPINIONS

The first administration source told Reuters that there were diverging opinions within the U.S. government about how to proceed and it was possible that Trump could sign the executive order before the 100-day mark of his presidency.

The source noted that the administration wanted to tread carefully. “There is talk about what steps we can take to start the process of renegotiating or withdrawing from NAFTA,” this source said.

Mexico had expected to start NAFTA renegotiations in August but the possible executive order could add urgency to the timeline.

The Mexican government had no comment on the draft order. The country’s foreign minister said on Tuesday that Mexico would walk away from the negotiating table rather than accept a bad deal.

Trump recently ramped up his criticism of Canada and this week ordered 20 percent tariffs on imports of Canadian softwood lumber, setting a tense tone as the three countries prepared to renegotiate the pact.

Canada said it was ready to come to talks on renewing NAFTA at any time.

“At this moment NAFTA negotiations have not started. Canada is ready to come to the table at any time,” said Alex Lawrence, a spokesman for Canadian Foreign Minister Chrystia Freeland.

(Reporting by Steve Holland; Additional reporting by Fergal Smith in Toronto, David Ljunggren in Ottawa,; Rodrigo Campos in New York and Julie Ingwersen in Chicago; Writing by Jason Lange; Editing by Tom Brown, Bill Rigby and Michael Perry)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/bwVhIfUQCyA/us-usa-trade-nafta-idUSKBN17S2DG

Empty Pearl River Delta branches a check on HSBC’s China plan


DONGGUAN, China/LONDON/HONG KONG In the digital age, footfall in bricks-and-mortar outlets is an incomplete measure of business activity, but HSBC’s empty branches in the Pearl River Delta (PRD) suggest it’s not all plain sailing for the bank’s expansion in mainland China.

HSBC, the world’s sixth-largest bank by assets, announced in 2015 that it would hire 4,000 new staff and invest billions to make the Pearl River Delta (PRD) its gateway to China, a retail and corporate banking push that bet on a tech boom, infrastructure spending and a growing middle class.

It is, as Chief Executive Stuart Gulliver reminded shareholders in Hong Kong on Monday, a key plank of the bank’s global strategy to improve profits by focusing on markets with stronger economic growth. PRD already generates more than 10 percent of China’s GDP and over a quarter of its exports.

On the ground, HSBC still has a mountain to climb.

In a rundown mall in Houjie, a factory town in the urban sprawl of Dongguan, the HSBC branch stands out with its bright posters and smiling receptionist, but only a handful of customers an hour crossed the threshold during a Reuters visit last week.

At the nearby Industrial and Commercial Bank of China (ICBC) branch in Changan, dozens rolled up in a similar period.

Large local rivals in the PRD, most state-backed, each have more than 1,000 branches to HSBC’s 114 including Guangdong, and they don’t have the headache of the tough compliance rules that HSBC has to follow to safeguard its international business.

It’s a headache the bank has to pass on to prospective customers.

A factory owner who gave his surname as Luo said he opened an HSBC account last year to facilitate his business making wooden floorboards and panels for clients in Hong Kong, where HSBC was founded in 1865.

Luo, who spoke to Reuters as he was leaving the Houjie branch, represents the kind of affluent Chinese customer with business in Hong Kong that the bank is keen to snag.

But opening a bank account was “quite a lot of trouble”, he said, and took nearly two weeks.

HSBC’s customer-checking procedures have got tighter in recent years after it was hit with billions of dollars in fines in the U.S. for lapses in anti-money laundering controls.

A HSBC staff member at the branch, who declined to be named, confirmed that customer background checks can take longer than at local banks that have no or negligible U.S. business at risk and are not subject to global regulatory scrutiny.

MAKING PROGRESS

HSBC says it is pleased with its progress in China. At the start of April it had 150,000 credit cards in circulation, having begun to issue them in December, mostly after digital applications.

It has also launched online trading and banking over social media platform WeChat.

“We do not intend to compete on a traditional basis in PRD. Absolute branch numbers and footfall will not be our measure,” said Kevin Martin, HSBC’s Asia Pacific head of retail banking and wealth management.

But that’s a game its big rivals are also playing; ICBC, for example, has offered WeChat banking since 2013.

Since HSBC announced its strategy in June 2015, China’s slowing growth and a stock market crash have prompted a rethink on the pace of expansion.

CEO Gulliver said last year it would take on the 4,000 new regional hires over five years, not three, as initially planned.

“Quite rightly, management felt at that time they didn’t want to achieve the strategy by taking on more risk,” Sam Laidlaw, an independent board member at HSBC, told Reuters.

Investors remain broadly positive.

“It’s not an overnight thing, and of course everyone wants it to be faster. The (China) strategy should be pursued – but it is only one of many strategies for HSBC,” said Hugh Young, Singapore-based fund manager at Aberdeen Asset Management, HSBC’s 6th-largest shareholder.

And what figures the bank has disclosed for 2016 are encouraging, albeit from a low base; it said in its annual report that its number of retail banking and wealth management clients and its mortgage loan book in the area had both increased by 51 percent during the year.

But it also has some battles with red tape to win.

The lender is still waiting for approval for its securities business venture with a state-owned fund in the PRD, more than a year after it announced the partnership.

And some say the bank remains something of an outsider.

At the Ling Jia Property Agency, a few meters from HSBC’s Houjie branch, realtor Yi Linfeng said most of his customers use ICBC for mortgages. None, he says, have ever used HSBC.

“I think they mostly have foreign customers from Taiwan and Hong Kong.”

(Additional reporting by Carolyn Cohn in London; Editing by Will Waterman)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/Da0sD6VNr9M/us-hsbc-china-idUSKBN17T0YC

Samsung Elec flags stronger second quarter; Elliott welcomes share cancellation


SEOUL Samsung Electronics Co Ltd on Thursday flagged stronger earnings and announced a cancellation of treasury shares after posting a solid first-quarter profit boosted by the memory chip business, sending its shares to a new high.

Samsung rejected a call from U.S. activist hedge fund Elliott to split itself in two but accepted part of the fund’s proposals on Thursday, revealing plans to cancel its existing treasury shares worth over $35 billion by 2018.

While the first quarter was a torrid time for Samsung as chief Jay Y. Lee was swept up in a political corruption scandal, the world’s top maker of memory chips, smartphones and televisions still managed to book a profit that supports expectations for record earnings in 2017.

First-quarter operating profit for Asia’s most valuable company by market capitalization was 9.9 trillion won ($8.75 billion), matching Samsung’s earlier guidance. Revenue rose 2 percent to 50.5 trillion won.

Elliott welcomed the share cancellation and said it saw “room for even more progress”. The fund had called for Samsung to adopt a holding company structure by splitting itself in two, and to pay out a 30 trillion won a special dividend.

“We are encouraged that Samsung Electronics has agreed to take the bold step of optimizing its balance sheet … even as the company has faced obstacles,” Elliot said in a statement.

Samsung Electronics shares were up 2.6 percent at a record high in a flat wider market.

In rejecting Elliott’s call for a holding company structure, Samsung cited issues including regulatory and legal risks, and said it would not boost investor returns.

“Samsung concluded the risks and the challenging environment surrounding a change in the corporate structure would not be beneficial for enhancing shareholder value and sustaining long-term business growth,” it said in a statement.

CHIPS SIZZLE

A memory chip super-cycle and the revival of the mobile business – damaged by the costly failure and fire-prone Galaxy Note 7 last year – look set to underpin Samsung’s profitability after the best quarterly result since 2013.

“Looking ahead to the second quarter, the company expects to achieve growth on the back of continued robust memory performance together with improved earnings from the mobile business” following the global rollout of the new Galaxy S8 smartphone, Samsung said in a statement.

Samsung’s chip business remained the top earner with a record 6.3 trillion won operating profit, buoyed by price gains for both DRAM and NAND memory chips as supply growth constraints and demand for more firepower on devices such as smartphones and servers boosted margins.

The Apple Inc competitor’s mobile division reported January-March operating profit of 2.07 trillion won, down from 3.89 trillion won a year earlier. Samsung had no new premium product generate meaningful sales in the January-March period.

Pre-orders for the Galaxy S8 launched in April were better than many analysts had expected, raising hopes the new flagship handset will make up for the failure of Note 7s.

Recent complaints about red-tinted screens and spotty Wi-fi connection on the S8 would not have a major impact on the bottom line, analysts said.

(Reporting by Hyunjoo Jin and Se Young Lee; additional reporting by Joyce Lee; Editing by Stephen Coates)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/Of0JrdO3Do8/us-samsung-elec-results-idUSKBN17S376

United to offer passengers up to $10,000 to surrender seats


NEW YORK United Airlines said on Thursday it would offer passengers who volunteer to forfeit their seats on overbooked flights up to $10,000 as part of the carrier’s efforts to repair the damage from the rough removal of a passenger.

The offer came after rival Delta outlined plans to offer up to $9,950 in such cases.

United also said it would take actions to reduce overbooking flights and improve customer satisfaction.

“Our goal is to reduce incidents of involuntary denial of boarding to as close to zero as possible and become a more customer-focused airline,” the carrier said in the statement.

United had spent the last two weeks embroiled in controversy after videos recorded by fellow passengers, which went viral, showed David Dao, 69, yanked from his seat aboard a Louisville, Kentucky-bound United flight before takeoff from Chicago’s O’Hare International Airport to make room for crew members.

Dao lost two front teeth in the scuffle, incurred a concussion and broke his nose, according to his lawyer, and will likely sue the airline.

United typically oversells flights by less than zero to 3 percent of the plane’s seat capacity to account for no-shows.

United said it would no longer call law enforcement to deny passengers boarding, nor would passengers who are already seated be required to give up their seats on overbooked flights.

United will adopt a “no questions asked” policy on permanently lost baggage, paying customers $1,500 for the value of the bag and its contents, beginning in June.

“This is a turning point for all of us at United,” Chief Executive Oscar Munoz said in a statement.

Munoz, who took the helm at United in 2015 as part of an effort to improve customer relations, has faced calls to step down after referring to Dao as “disruptive and belligerent” in a statement following the incident.

It sparked a national conversation on U.S. carriers’ treatment of customers in an industry comprising just a handful of competitors following years of mergers and consolidations.

United announced last week that Munoz, in a move he himself initiated, would not become company chairman in 2018 as stated in his employment agreement.

(Reporting by Alana Wise; Editing by Richard Chang)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/bENG5Ue4N4Y/us-ual-passenger-idUSKBN17T0HC

Shares in Japan’s Takata suspended after report on bankruptcy plan


TOKYO Trading in Takata Corp shares was suspended on Thursday after a report that the Japanese airbag maker at the heart of the car industry’s biggest-ever recall is considering a bankruptcy plan that will create a new company and ringfence its liabilities.

The Nikkei business daily reported Chinese-owned car parts maker Key Safety Systems (KSS), the company’s preferred bidder, would sponsor the turnaround plan by injecting 200 billion yen ($1.8 billion) and helping create a new operating company.

That money would be transferred to Takata to help settle claims linked to faulty air bags that have been blamed for at least 16 deaths worldwide.

Agreement on a restructuring deal, eight years after the first death, would enable Takata to draw a line under the crisis and help it continue supplying replacement air bag inflators, as well as selling seat belts and other vehicle components.

In a statement, Takata acknowledged that its steering committee had endorsed KSS as a sponsor candidate, but said it had not reached any decision on its restructuring.

Reuters reported earlier this month that a group including KSS, a U.S. unit of China’s Ningbo Joyson Electronic Corp, and Bain Capital LLC was Takata’s preferred bidder, and would offer around 200 billion yen.

Takata has long insisted it prefers a privately arranged restructuring, but people with knowledge of the situation have told Reuters that the company has come under increasing pressure from potential bidders and automaker clients to agree to a court-ordered process, which would provide more transparency.

Automakers including Honda Motor Co Ltd, which have been paying for recalls for almost a decade, have insisted on the court route – even if that would wipe out shareholder value, hitting the founding Takada family, with a 60 percent stake.

Takata’s steering committee and potential bidders have been negotiating for months, with talks dragging due to differences over issues including price and how to handle risks for suppliers, two sources with knowledge of the issue have told Reuters.

A spokeswoman for KSS declined to comment, while Hong Kong-based representatives for Bain could not immediately be reached.

Discussions that involve the automaker’s clients, suitors and bankers are likely to run on until at least the end of May before a decision is reached, sources have said.

In January, Takata agreed to plead guilty to criminal wrongdoing in the United States and to pay $1 billion to resolve a U.S. federal investigation into its inflators.

A federal judge in Detroit this month said he plans to name former Federal Bureau of Investigation director Robert Mueller to oversee nearly $1 billion in Takata restitution funds, as part of a U.S. Justice Department settlement.

Takata shares are indicated to fall about 8.5 percent from Wednesday’s close.

(Reporting by Chang-Ran Kim, Naomi Tajitsu, Tim Kelly and Junko Fujita; Editing by Clara Ferreira-Marques and Randy Fabi)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/rP9UgalBEzk/us-takata-restructuring-idUSKBN17S37E

Judge says Exxon owes $19.95 million for Texas refinery pollution


HOUSTON A federal judge ruled on Wednesday that ExxonMobil Corp should pay a $19.95 million penalty for pollution from its Baytown, Texas, refining and chemical plant complex between 2005 and 2013.

U.S. District Court Judge David Hittner issued the ruling in a citizen lawsuit brought under the U.S. Clean Air Act by two environmental groups, Environment Texas and the Sierra Club.

Environment Texas welcomed the decision in the long-running suit, which was first filed in 2010.

“We think it might be the largest citizen suit penalty in U.S. history,” said Luke Metzger, director of Environment Texas. “It definitely means it pays not to pollute.”

Exxon said it would consider its legal options and may appeal the ruling.

“We disagree with the court’s decision and the award of any penalty,” Exxon spokesman Todd Spitler said in an emailed statement. “As the court expressed in its decision, ExxonMobil’s full compliance history and good faith efforts to comply weigh against assessing any penalty.”

The suit was filed under a provision of the Clean Air Act that allows citizens to sue when regulators have failed to stop pollution. The two groups had contended the penalty could run as high as $573 million, but had only sought $41 million.

In a 101-page decision, Hittner ruled there had been 16,386 days of violations and 10 million pounds (4.5 million kg) of pollutants had been released in violation of operating permits issued to Exxon for the Baytown complex.

“The court finds given the number of days of violations and the quantitative amount of emissions released as a result, the seriousness factor weighs in favor of the assessment of a penalty,” he wrote.

The decision comes about a year after the Fifth U.S. Circuit Court of Appeals determined Hittner had errored in a 2014 ruling assessing Exxon’s liability for pollution from the refinery, chemical plant and olefins plant in the Baytown complex in the eastern suburbs of Houston.

The Fifth Circuit Court sent the case back to Hittner to reassess Exxon’s liability.

The Baytown complex, which includes the second largest refinery in the United States, is regulated by the Texas Commission on Environmental Quality (TCEQ), which had fined Exxon $1.4 million for pollution. Hittner deducted that amount in determining the penalty.

The penalty will be paid to the federal government. Hittner said Exxon was liable for legal fees incurred by the two environmental groups.

(Reporting by Erwin Seba; Editing by Richard Pullin)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/5GeqCO79tXY/us-refinery-pollution-exxon-penalty-idUSKBN17T08H

Companies cheer Trump tax cuts, but jobs are less certain to follow


U.S. businesses would reap a windfall if President Donald Trump’s plan to cut corporate tax rates and slash taxes on cash parked overseas becomes law, but it was unclear whether they would stimulate a surge in investment and job creation in return.

Under Trump’s proposals, American companies would move from being the most highly taxed among the Group of 20 countries to among the lowest. Tax rates would fall below those of neighboring Mexico and Canada, which Trump has accused of shortchanging the United States in trade deals.

Corporate leaders and business lobbying groups such as the U.S. Chamber of Commerce on Wednesday cheered the administration’s tax proposals, while allowing that the initial one-page plan left out crucial details.

The tax plan, which includes a cut in taxes on public companies to 15 percent from 35 percent, does not detail cuts in spending that would help keep the budget deficit under control.

ATT Corp (T.N) Chief Executive Randall Stephenson welcomed the tax plan but cautioned “the practical reality of getting to 15 percent is you have to get yourself reconciled to some level of deficits for a period of time as you get the economic stimulation.”

Big U.S. companies have nearly $1.8 trillion in cash stockpiled overseas, according to Moody’s Investors Service. Technology powerhouse Apple Inc (AAPL.O) has more than $200 billion of that total.

Apple did not immediately respond to a request for comment on Wednesday, but Chief Executive Officer Tim Cook has said the company was looking to bring back offshore cash if tax rates for doing so were lower.

“What we would do with it, let’s wait and see exactly what it is, but as I’ve said before we are always looking at acquisitions,” Cook told investors on the company’s first-quarter earnings call in January in response to an analyst’s question about the company’s thinking on acquisitions.

Cook’s comment points to a big unknown for the White House and congressional Republicans, who have said business tax cuts would result in more and better jobs.

Studies of the results of past tax holidays found that most of the offshore cash brought home by U.S. companies was used to buy back shares or make acquisitions, not to fund investments in production capacity or jobs.

Under pressure from shareholders, listed companies have set high targets for return on invested capital. General Motors Co (GM.N), for example, has told investors it is aiming for 20 percent returns on its capital investments.

Many U.S. companies have been tightfisted about investing in new plants and equipment following the last recession, which left them wary of becoming overextended. Since 2014, investment in new equipment has flatlined, according to government data.

A MIXED BAG

The financial impact of the White House tax plan will vary widely by company and business sector. A proposal to cut inheritance taxes, for example, is of high interest to auto dealers, which are often family-controlled enterprises.

Many companies already pay less than the headline 35 percent tax rate. Companies in the SP 500 index paid an average tax rate of 29.06 percent for 2016, Standard and Poors said.

A change of a few percentage points in tax rates can make a big difference. Aircraft maker Boeing Co (BA.N) on Wednesday reported a 19 percent increase in first quarter profits, partly because of a 4 percentage-point drop in its tax rate.

“At the highest level we’re a big supporter of tax reform,” Boeing Chief Financial Officer Greg Smith told analysts and journalists on a call Wednesday. “It’s going to drive jobs, it’s going to drive the U.S. economy broadly speaking and it’s going to allow us to compete.”

Boeing has been cutting jobs in the United States, warning employees last week that it planned another round of cuts that would eliminate hundreds of engineering jobs.

While the tax cuts may produce a short-term boost to the economy and add fuel to a stock market rally, it falls short of the comprehensive tax reform that Trump had pledged earlier.

Regarding other parts of his agenda, his administration has been stymied in its attempts to limit immigration by the courts, while an attempt to repeal and replace Obamacare failed in Congress.

“A cynic would say this is a rushed attempt to have something big to show for President Trump’s first 100 days in office,” said Luke Bartholomew, investment strategist at Aberdeen Asset Management in London.

(Reporting by Ginger Gibson, David Shepardson, Diane Bartz, Steve Nellis and Tim Aeppel; Writing by Joseph White; Editing by David Chance and Bill Trott)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/3SbHv-4vNyw/us-usa-tax-business-idUSKBN17S2WF

Cost controls help offset lower Amgen first-quarter drug sales


Amgen Inc (AMGN.O) on Wednesday reported higher-than-expected first-quarter profit as cost controls helped offset a sharp drop in sales of Enbrel, its blockbuster rheumatoid arthritis and psoriasis drug.

The world’s largest biotechnology company said net profit rose to $2.07 billion, or $2.79 per share, from $1.9 billion, or $2.50 per share, a year ago.


Excluding special items, Amgen said it had adjusted earnings of $3.15 per share. Analysts on average expected $3.00 per share, according to Thomson Reuters I/B/E/S.

(Reporting by Bill Berkrot in New York; Editing by Matthew Lewis)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/0skJU3Fxz1w/us-amgen-results-idUSKBN17S2RF