By Noel Randewich and Shristi Achar A

(Reuters) – Wall Street stocks rose on Monday, with the Nasdaq jumping over 1% as Tesla surged on optimism around artificial intelligence and investors awaited inflation data due later this week.

Tesla rallied almost 10% after Morgan Stanley upgraded the electric car maker to “overweight” from “equal-weight,” saying its Dojo supercomputer could boost the company’s market value by nearly $600 billion.

Other megacaps also rose, with Amazon up 3% and Microsoft climbing 1%.

Meta Platforms added 3.4% after a report on Sunday said the social media platform was working on a new, more powerful AI system.

Investors are looking to August consumer price index data due on Wednesday for clues about how close the Federal Reserve may be to ending its campaign of interest rate hikes. That will be followed by producer price data on Thursday.

A New York Fed survey showed Americans’ overall views on inflation were little changed in August, as they predicted rising costs for homes and food, while expecting bleaker personal financial health.

“What we’re seeing is a lot of positive sentiment that is really tied to bullishness around the likely CPI and PPI numbers being more in line with moderation,” said Greg Bassuk, chief executive officer of AXS Investments in New York.

“As long as the inflation numbers for August come in within the band of expectations, we’re going to see the Fed move away from additional rate hikes.”

Wall Street logged weekly losses on Friday after a recent uptick in oil prices and stronger-than-expected economic data fueled concerns of sticky inflation and interest rates staying higher for longer.

Traders see a 93% chance that the central bank will hold its interest rates at current levels at its September meeting, while chances of a pause in November stand at 57%, according to the CME FedWatch Tool.

Fed officials have entered a blackout period, during which they usually do not make public comments, until the policy decision outcome on Sept. 20.

Of the 11 S&P 500 sector indexes, nine rose, led by consumer discretionary, up 2.55%, followed by a 1.16% gain in communication services.

The S&P 500 climbed 0.63% to 4,485.51 points.

The Nasdaq gained 1.08% to 13,910.83 points, while Dow Jones Industrial Average rose 0.25% to 34,662.93 points.

Qualcomm advanced 4% after the chipmaker signed a new deal with Apple to supply 5G chips to the iPhone maker until at least 2026. Other chipmakers declined, with Nvidia NVDA.O> down 1.1%.

Hostess Brands jumped 19% after J. M. Smucker said it would buy the Twinkies-maker in a $5.6 billion deal.

Advancing issues outnumbered falling ones within the S&P 500 by a 1.7-to-one ratio.

The S&P 500 posted 12 new highs and 11 new lows; the Nasdaq recorded 29 new highs and 156 new lows.

(Reporting by Ankika Biswas, Shreyashi Sanyal and Shubham Batra in Bengaluru, and by Noel Randewich in Oakland, Calif; Editing by Arun Koyyur, Vinay Dwivedi and Richard Chang)

By Saeed Azhar

NEW YORK (Reuters) -Goldman Sachs appointed Chief Administrative Officer Ericka Leslie head of operations for global banking and markets, its largest division, according to a memo seen by Reuters.

The move reduces the bank’s number of executive officers to eight, for now, and leaves just two women in the group.

Leslie’s previous duties will be divided among other executives, people familiar with the matter said.

“Ericka is moving into one of the biggest and most important businesses,” a company spokesperson told Reuters.

The two women who remain among the executive officers are Chief Accounting officer Sheara Fredman and Chief Legal Officer and General Counsel Kathryn Ruemmler. The group is led by CEO David Solomon and includes John Waldron, the bank’s president, and Denis Coleman, its finance chief.

Despite efforts to diversify the management of Wall Street firms, men vastly outnumber women in the top ranks. Citigroup’s Jane Fraser is the only woman CEO among the largest U.S. banks, and the short list of candidates for Morgan Stanley’s next CEO does not include any women.

“Unfortunately, Wall Street boards and executives have not done enough to attract and retain women at banks,” said Mayra Rodriguez Valladares, a financial risk consultant at MRV Associates who trains bankers and regulators.

“Moreover, they have not been able to mentor them well enough to reach the C-suite.”

Leslie, who is also co-chair of the partnership committee, joined Goldman as an associate in 1996 and became a partner in 2012. The executive has held various leadership roles, including head of technology for currencies and commodities, and operations for the securities division, according to the Goldman memos.

Leslie is replacing Will Bousquette, who has been appointed chief operating officer of the asset and wealth management division, according to another memo by Marc Nachmann, who leads the unit.

“We’ve identified growth opportunities and built an organizational structure that will allow us to take advantage of them,” Nachmann wrote.

The memos did not indicate when the changes would take effect.

Bousquette, who joined the firm in 1998 and became a partner in 2014, succeeds Laurence Stein, a 27-year Goldman veteran who plans to retire at the end of the year, the memos said.

Goldman Sachs has made a raft of changes since it divided its business into three units last year and scaled back ambitions for its consumer business, which has lost $3 billion in the last three years.

It has also been refocusing its wealth business on the super rich, recently striking a deal to sell part of its wealth unit to an independent manager.

The Wall Street giant has seen a number of high-profile departures in recent months, including Julian Salisbury, chief investment officer of asset and wealth management, who is joining investment firm Sixth Street.

The partner departures are “absolutely typical” and allow the bank to make room for new leaders, Solomon told CNBC in an interview last week. More than 400 people comprise its elite partner ranks.

“If the partnership’s a certain size and we want to make a certain number of partners, we have to create that amount of movement over the course of every two-year period,” he said.

Goldman is also gearing up for another round of job cuts for employees who are seen to be underperformers, which could come in October, a person familiar with the matter told Reuters last week, confirming a report in the Financial Times.

The bank laid off about 3,200 people earlier this year in its biggest headcount reduction since the 2008 financial crisis.

(Reporting by Saeed Azhar; editing by Lananh Nguyen, Megan Davies and Jason Neely)

By Noel Randewich and Hannah Lang

(Reuters) – Retail traders getting their first bite at Arm Holdings’ highly anticipated public offering when the British chip designer begins trading this week should beware: individual investors often get burned when they jump on hot listings.

Arm’s goal of raising around $5 billion in New York in what might be the biggest IPO of 2023 follows other major listings in recent years whose returns have mostly disappointed.

Since Arm, owned by Japan’s SoftBank Group’s, is not well-known among consumers, it is focusing its IPO marketing efforts on institutional investors, people familiar with the deal said.

That leaves Main Street investors to buy Arm shares at potentially higher prices once they begin trading. With retail investors holding individual stocks for less than a year on average, recent history suggests they could lose money, a Reuters analysis shows.

The 10 biggest U.S. initial public offerings (IPOs) of the past four years are down an average of 47% from the closing price on their first day of trading, according to the analysis of LSEG data as of Friday. Investors who bought at the top of an intra-day price surge that often occurs in high-profile listings would have fared even worse, with an average loss of 53%.

Only two of the stocks in those top 10 are up from their IPO prices: software seller Snowflake and Airbnb, which leads with a 111% return.

While dabbling in individual stocks is a notoriously risky business for amateur investors, the analysis underscores just how perilous it can be to buy into blockbuster IPOs on Day One.

Even institutional investors invited to buy into those 10 IPOs before trading would be down an average of 18%.

The S&P 500 has gained an average of 13% since each of those IPOs, nine of which happened in 2020 and 2021.

“If you’re buying in the market, on average, you’re buying at a premium to the offer price,” said Jay Ritter, a professor at the University of Florida who studies IPOs. “For almost all retail investors, buying and holding a low-cost index fund is the best strategy.”

Arm’s debut and an upcoming listing from grocery delivery service Instacart are expected to rejuvenate a lackluster IPO market which has slowed over the past two years due to volatility and economic uncertainty.

Instacart will be offering some retail investors a chance to buy into its IPO via underwriter fintech company SoFi, its prospectus said.

While Arm is a business-to-business company with little consumer brand recognition, its IPO publicity is likely to attract retail interest, said analysts. Nvidia, the chipmaker at the center of an artificial intelligence boom, has been a retail favorite this year.

Retail participation in U.S. stocks surged in 2021, fueled by low interest rates, zero-cost trading apps, and social media hype around GameStop and other so-called meme stocks.

But Main Street investors have become more cautious after last year’s stock market sell-off, said Marco Iachini, a senior vice president at Vanda Research, which tracks retail trades.

“Whatever comes out of the Arm IPO, you’ll see niches of the retail community trying to get in on it, but it’s not going to be at the levels we saw in some of the IPOs in 2021,” he said.

Spokespeople for Arm and SoFi declined to comment. Spokespeople for Instacart and the 10 companies whose IPOs were analyzed did not provide comment, or did not respond to comment requests.

CRUSHED VALUATIONS

Arm is seeking up to $51 per share, potentially valuing it at more than $50 billion – the most valuable company to list in New York since electric carmaker Rivian Automotive debuted in 2021.

Burning through cash to ramp up production, Rivian’s market value has collapsed by over $60 billion since it listed. Also among the biggest IPOs in recent years, food delivery company DoorDash’s stock remains down by more than half from its intraday high on its December 2020 debut.

To be sure, it has been a tough few years for IPOs. Wall Street’s steep sell-off in 2022, along with rising interest rates and fears of a potential U.S. recession, have crushed valuations of companies that went public before they were profitable. But studies by Ritter and others have shown IPOs offer poor returns.

In the past four years, over 260 IPOs have debuted with stock market values above $1 billion, mostly in the technology, healthcare and consumer discretionary sectors, according to LSEG. They are down on average 29% from their offering prices and down 49% from their initial trading highs.

One standout among recent big IPOs is chipmaker GlobalFoundries, which has gained 23% since its 2021 listing, compared to the S&P 500’s 3% dip over that time.

(Additional reporting by Lance Tupper, Anirban Sen and Echo Wang; editing by Michelle Price and Richard Chang)

By David Morgan

WASHINGTON (Reuters) – The U.S. House of Representatives returns this week for an expected political brawl over spending cuts and impeachment that could paralyze the Republican-controlled chamber, as Congress struggles to avoid a government shutdown.

The House and the Democratic-controlled Senate are due to be in session for about 12 days before funding expires on Sept. 30, leaving little time to agree on a package of 12 appropriations bills that can pass each chamber and win Democratic President Joe Biden’s signature.

The main bone of contention among House Republicans is a demand by roughly three-dozen members of the hardline House Freedom Caucus to cut spending for fiscal 2024 to $1.47 trillion — about $120 billion less than Biden and Republican House Speaker Kevin McCarthy agreed in May.

The White House and Senate leaders — including top Republican Mitch McConnell — have rejected that demand.

That dispute and other hardline demands, including opposition to Ukraine aid and calls for an impeachment inquiry against Biden, could imperil efforts to pass a short-term stopgap, known as a continuing resolution or “CR,” which would keep federal agencies afloat while lawmakers debate full-scale appropriations.

“Everything’s coming to a head after a long recess,” Republican Representative Kelly Armstrong told Reuters, referring to the six-week-long House summer break that ends Tuesday. “We’re a pretty diverse caucus, with a five-vote majority. So, threading the needle is something that’s really difficult to do.”

McCarthy’s eight-month-old speakership could be threatened if he seeks Democratic support to avoid a shutdown or fails to move forward with an impeachment inquiry that former President Donald Trump’s House allies are seeking despite a lack of votes.

Political brinkmanship over the debt ceiling has already prompted the Fitch rating agency to downgrade U.S. debt to AA+ from its top-notch AAA designation, partly because of repeated down-to-the-wire negotiations that threaten the government’s ability to pay its bills.

White House spokesperson Andrew Bates warned that failure to enact $24 billion in supplemental funding for Ukraine and $16 billion for disaster-stricken U.S. communities in states including Hawaii and Florida could put lives at risk, while delaying money to combat the deadly opioid fentanyl.

SOME PREFER SHUTDOWN

Hardline Republicans want offsets for spending on disaster relief and Ukraine aid included in any CR, as well as tighter immigration and border security policies.

“Without these spending cuts, we’re a ‘no’ vote. I say ‘we’ – me and a good many others,” Representative Ralph Norman, a Freedom Caucus member, said in an interview. “I’d rather shut the government down.”

That could mean trouble for McCarthy’s hopes of restarting action on spending legislation this week with an $886 billion defense appropriations bill.

The House, which Republicans control by a thin 222-212 majority, has passed only one appropriations bill so far.

The Senate plans to move forward on Monday with bipartisan bills. Senators of both parties hope floor action will give them the upper hand in negotiations with the House.

House hardliners vehemently reject a proposal to lump border security and Ukraine aid in a separate measure.

“We’re going to have to see some significant win for the American people,” Freedom Caucus Chairman Scott Perry told Reuters. “We’ve been abundantly clear, transparent and precise about how you get votes out of members in the Freedom Caucus.”

Hardliners, who forced McCarthy to endure 15 floor votes before he became speaker in January, shut down the House floor in June to protest his spending deal with Biden.

Their demands have irked more centrist Republicans.

With the Senate and White House in Democratic hands, Representative Don Bacon said House Republicans should accept the higher spending level set by the McCarthy-Biden agreement and adopt a relatively clean CR.

“There’s no reason to do a shutdown when you already have a bipartisan agreement,” Bacon told Reuters. “I know that 20 or 30 people don’t like it. But they don’t represent the whole House and they don’t represent the whole country.”

Firebrand Representative Marjorie Taylor Greene vowed not to support funding measures unless the House votes to begin an inquiry on unproven allegations that Biden was involved in his son Hunter’s overseas business dealings while vice president. Biden and the White House deny the claims.

Other Republicans reject the idea of tying an impeachment inquiry to the spending debate.

Democrats have dismissed impeachment talk as little more than an effort to distract from Trump’s extensive legal woes.

” … Until you have the votes, it seems kind of silly,” Democratic Senator John Fetterman told reporters.

(Reporting by David Morgan; additional reporting by Makini Brice, Jeff Mason, Richard Cowan and Moira Warburton; Editing by Scott Malone and Jonathan Oatis)

LONDON (Reuters) – In early 2021, investment management firm Artisan Partners sent an open letter to an incoming member of Danone’s board, saying it had built a stake of more than 3% in the French food giant. “On almost every measure, Danone’s performance has lagged,” Artisan said, and called for change.

About a month later, Danone’s then-CEO and chairman, Emmanuel Faber, was ousted and its board overhauled in a high-profile victory for shareholder activism.

Today, Artisan, which manages about $146 billion, is Danone’s top shareholder with a 7% stake, according to LSEG data. David Samra of Artisan’s International Value team, which seeks investment opportunities in under-valued businesses, said more changes may be coming.

“I wouldn’t be surprised if there’s more turnover at the very senior levels,” Samra told Reuters, noting the “very mediocre” performance of Danone shares. “If somebody is not performing, we will get new people.”

Danone, the maker of Activia yogurt and Evian bottled water, did not respond to a request for comment.

The company’s stock has declined around 13% in the past two years. Unilever and other large rivals have also underperformed the EURO STOXX Consumer Products and Services EUR Price index over the past year.

Reuters spoke to four shareholders that have launched activist campaigns who said that some big consumer goods companies are ripe for executive changes after failing to impress. The sources declined to name specific companies, in some cases because they work with them.

Data shared exclusively with Reuters by consultancy Alvarez & Marsal also showed that, in the first seven months of the year, the consumer goods industry was the most targeted by activist investors.

Some 236 campaigns were launched globally between January and July, the most the industry has seen in at least half a decade, Alvarez & Marsal said.

That represented a fifth of all activist pushes across all sectors during that period. Alvarez & Marsal did not identify the targets of the campaigns nor say what they were about.

Many large consumer goods companies generally hold low levels of debt and are cash generative, said André Medeiros, managing director and Alvarez & Marsal’s EMEA consumer and retail leader. Their scale also often offers activist shareholders multiple levers to pull – including cost cutting, brand divestments, operational improvement and the adoption of new technology – as they look for growth and higher margins, he added.

Billionaire activist fund manager Nelson Peltz took a seat on Unilever’s board in July 2022, having praised the maker of Dove soap and Ben & Jerry’s ice cream for its strong brands and international footprint. His New York-based fund Trian is now the company’s fourth-biggest shareholder, according to LSEG data.

Artisan’s Samra said Peltz’s presence at Unilever gave him “confidence”. Samra’s fund has built a roughly $900 million stake in Unilever, having bought shares during the second quarter when the price declined, Artisan told Reuters. The stake would make it Unilever’s 13th largest shareholder, the LSEG data said. “We’re not active with Unilever. We don’t need to be because Nelson Peltz is doing it,” Samra said.

Peltz is known for his interest in consumer-oriented firms and for his role in reshaping H.J. Heinz as well as engineering the break up of Cadbury Schweppes. Shortly after his arrival on the board, Unilever appointed a former Heinz executive as CEO.

Unilever’s food business has struggled with slow growth for years, fuelling speculation it could be spun off. Unilever and Trian declined to comment for this story.

‘ADVOCATING FOR MANAGEMENT CHANGE’

Gianluca Ferrari, founding partner of investor Clearway Capital, said his firm had some consumer companies on its radar but declined to name them. The Frankfurt-headquartered fund does not publicly disclose its assets under management.

With inflation running high in many economies, Clearway is looking for companies with strong brands and potential pricing power that would help to insulate them from it.

“If we feel the board and management are underpricing their products, that’s a perfect reason for us to go in and take a very close look at a business with the intention of engaging,” Ferrari said.

“There is one situation that we’re having a very close look at where I think advocating for management change would probably be the right thing to do,” he added. Clearway last year pushed for change at sports supplement maker Glanbia. Since Clearway’s letter to Glanbia’s board in May 2022 calling for a break-up of the company to help unlock value, the Irish company’s share price has jumped about 39% and its longtime CEO plans to retire.

Glanbia did not respond to a request for comment.

At the end of 2020, Bluebell Capital also bought a stake in Danone and, according to media reports, joining Artisan in lobbying for the removal of then-chairman and CEO Faber. Bluebell declined to comment on its engagement.

“Danone was significant because there is less of a history of activism in consumer staples in Western Europe, and it was a CEO change led by shareholders — there was probably too much complacency from the board,” Nicolas Ceron, a portfolio manager at Bluebell, told Reuters.

He declined to confirm if Bluebell, which does not disclose its assets under management, still held a stake in Danone.

Ceron said that, although boards had become quicker to tackle underperformance, he saw a number of situations among consumer staples companies where things could be improved.

“There are more opportunities in global consumer staples for activists over the coming years, but the timing has to be right,” Ceron said. He did not cite specific companies.

ROOM FOR IMPROVEMENT

Several top industry executives – including at Diageo, Reckitt, Danone and Kraft Heinz – announced over the past year they are stepping down.

In some cases, the departures have been driven by the executive’s desires for a change of lifestyle in the wake of the global pandemic, said Andrew Hayes, global head of executive search firm Russell Reynolds Associates’ consumer practice. Some companies, however, felt that the business environment in the wake of the pandemic – characterised by supply chain issues, squeezed margins and slow growth – required a new kind of leadership, according to John Long, North America retail sector leader for rival search firm Korn Ferry.

“The CEOs that were able to navigate a crisis like the pandemic are not necessarily the same people who can foster growth,” Long said. He did not identify specific executives nor disclose the nature of his work with consumer companies.

Unilever’s former CEO Alan Jope departure’s after 38 years at the company was announced in September 2022, months after Peltz joined the board in July. Unilever’s longtime finance chief, Graeme Pitkethly, is also exiting by May 2024 after more than two decades at the company.

Peltz did not respond to a request for comment on whether he influenced Jope’s departure. In October, Reuters reported that Peltz had approached former CEOs of consumer goods companies as candidates for the Unilever top job. When Hein Schumacher was appointed, Peltz said he had been “impressed by his leadership skills and business acumen” when he had known him at Heinz.

Peltz in 2006 also won two seats on the board of H.J. Heinz – now Kraft Heinz – after waging an acrimonious, costly proxy battle.

Reflecting on the experience, Heinz’s then-CEO, Bill Johnson, told Reuters: “Nelson turned out to be a great contributor even though there were times we disagreed on issues and sometimes it got rather rancorous.”

“We all like to think as CEOs that we’re above that,” he said. “But there’s no company in the world that’s safe.”

(Reporting by Richa Naidu; Editing by Matt Scuffham and Daniel Flynn)

By Echo Wang and Anirban Sen

NEW YORK (Reuters) -Arm, the chip designer owned by SoftBank Group Corp, is getting close to securing enough investor support to attain the fully diluted valuation of $54.5 billion it was seeking in its initial public offering (IPO) at the top of its indicated range, and is considering asking investors to value it higher, people familiar with the matter said on Sunday.

Following strong demand from investors, Arm will likely be able to price the IPO at the top or above its $47-to-$51-per-share range when its underwriters close their books on Wednesday on the biggest U.S. stock market debut in two years, the sources said.

Arm is discussing the possibility of raising the price range and seeking a valuation of more than $54.5 billion, in light of the IPO’s oversubscription, the sources said. Alternatively, Arm is also considering keeping the price range as is and pricing the IPO above it on Wednesday, which would also lead to a valuation higher than $54.5 billion, the sources added.

Arm will not, however, offer more shares, given that SoftBank wants to retain a 90.6% stake in Arm following the approximately $5 billion IPO, as originally planned, the sources said.

A decision on whether to raise the price range will come in the next two days after some key orders from investors come in on Monday, according to one of the sources.

The sources, who spoke on condition of anonymity to discuss confidential deliberations, cautioned that some anticipated investor commitments had not been finalized and the trajectory of the orders could still change.

SoftBank and Arm did not immediately respond to requests for comment.

The valuation that Arm has been seeking thus far represents a climb-down from the $64 billion valuation at which SoftBank last month acquired the 25% stake it did not already own in the company from the $100 billion Vision Fund it manages.

Yet even with this lower valuation, SoftBank would fare better than its $40 billion deal to sell Arm to Nvidia Corp, which it abandoned last year amid opposition from antitrust regulators.

Arm has already signed up many of its major clients as cornerstone investors in its IPO, including Apple, Nvidia, Alphabet, Advanced Micro Devices, Intel and Samsung Electronics.

Arm launched its IPO marketing efforts last week, seeking to convince investors it has growth ahead of it, beyond the mobile phone market, which it dominates with a 99% share.

Weak mobile demand during a global economic slowdown has caused Arm’s revenue to stagnate. Overall sales totaled $2.68 billion in the 12 months to the end of March, compared to $2.7 billion in the prior period.

Arm told potential investors in New York on Thursday that the cloud computing market, of which it has only a 10% share and therefore more room to expand, is expected to grow at an annual rate of 17% through 2025, partly thanks to advances in artificial intelligence. The automotive market, of which it commands 41%, is forecast to expand by 16%, compared with just 6% growth expected for the mobile market.

Arm also told investors its royalty fees, which account for most of its revenue, were accumulating since it started collecting them in the early 1990s. Royalty revenue came in at $1.68 billion at the latest fiscal year, up from $1.56 billion a year before.

An area of scrutiny for investors has been Arm’s exposure to China, given geopolitical tensions with the United States that have led to a race to secure chip supplies. Sales in China contributed 24.5% of Arm’s $2.68 billion revenue in fiscal 2023.

(Reporting by Echo Wang and Anirban Sen in New YorkEditing by Greg Roumeliotis and Diane Craft)

By Ahmed Eljechtimi

TAFEGHAGHTE, Morocco (Reuters) – Hamid ben Henna had just asked his young son Marouane to fetch a knife to cut a melon for the family’s evening meal when Morocco’s earthquake hit on Friday night.

With the weekend beginning, they had been enjoying a lamb and vegetable tagine stew and Marouane had been telling his father what materials he would need for the coming school year.

“That’s when it struck,” Ben Henna said. The room began to shake, the lights went out and rubble started falling from the ceiling of their traditional house in a remote village of the High Atlas mountains.

The earthquake was Morocco’s most powerful since at least 1900 and it killed more than 2,000 people, mostly in small mountain villages like Tafeghaghte where the Ben Henna family live.

Ben Henna and his other son, Mouad, staggered out of the open door into the alleyway as their house began to collapse. They managed to free his wife Amina and small daughter Meryem. But as the dust settled they saw that Marouane had not made it.

The eight-year-old had run further into the house and was lying under a meter of rubble.

His little body was only recovered the next day, after Ben Henna’s brothers arrived by car from Casablanca, five hours away, to help lift the rubble.

Marouane, described by his father as an enthusiastic boy who loved school, was buried on Saturday morning.

DESTITUTION

The family is now not only grieving but destitute. All their belongings lie in the wreckage of their fallen house and they face a third night sleeping outside in the bitter mountain cold.

Ben Henna’s source of livelihood, the three-wheel moped he used to ferry goods around the neighbourhood for a small fee, was buried in falling debris and no longer works. The alleyway leading to the ruins of their house is covered in fallen rocks.

The family still have a donkey and a goat that survived the quake. But their animal feed was buried in a collapsed storeroom and there is little point slaughtering the animals because they cannot refrigerate the meat.

Barely a house in Tafeghaghte seems unscathed by the disaster. Of the roughly 400 villagers, nearly 80 are dead, according to survivors. Large piles of rubble dot the village. One family Ben Henna knew lost seven members.

Families have gathered under olive trees in a small field to pitch shelters where survivors can spend the night, safe from aftershocks even if their damaged homes stayed mostly erect.

Fatima Boujdig sat with her husband in the shade of their large red truck, badly damaged by falling rubble, as a donkey grazed nearby. They borrowed money to buy the truck and do not know how they can now repay it.

“We were in darkness and covered in dust. We heard the earthquake and the rocks and walls falling… now you can see the village is reduced to rubble,” she said.

(Reporting by Ahmed El Jechtimi and Omer Berberoglu; Writing by Angus McDowall; Editing by Christina Fincher)

Bernard Arnault Invests $230 Million in LVMH Despite Stock Decline 

Billionaire Bernard Arnault made significant investments totaling €215 million ($230 million) in LVMH shares following the luxury conglomerate’s disappointing financial results in late July, which had led to a decline in the stock’s value.

French billionaire buys LVMH’s dip 

According to records filed with French regulatory authorities, Arnault’s companies, Financiere Agache and Christian Dior SE, initiated the acquisition of LVMH Moet Hennessy Louis Vuitton SE shares just three days after the release of the earnings report on July 25. Subsequently, the stock has experienced a 14% decrease in value, primarily influenced by economic slowdowns in China and the United States, persistent inflationary pressures, and the rising trend in interest rates.

The French entrepreneur, alongside his family, holds approximately 48% of LVMH’s equities, along with a significant 64% of the voting authority. Arnault, ranked as the planet’s second-richest person, frequently acquires LVMH shares, pausing during the blackout intervals associated with financial reports, as indicated in official disclosures. A spokesperson on behalf of Arnault chose not to comment on the issue.

LVMH’s financial performance for the second quarter indicated challenges for the luxury conglomerate, which owns well-known brands like Louis Vuitton and Tiffany & Co. Notably, the company encountered difficulties in the US market, where its organic revenue experienced a 1% decline. This disappointing outcome had a negative impact on investor sentiment, resulting in a 5.2% decline in the company’s stock price during the subsequent trading session. 

In the previous month, LVMH experienced a notable 7.8% decrease in its share value, marking the most substantial monthly decline since the end of the previous year, December. This recent downturn in the stock market led to the displacement of LVMH from its position as the leading European corporation in terms of market capitalization. Danish pharmaceutical company Novo Nordisk A/S surpassed the luxury conglomerate in this regard, thanks to the impressive sales performance of its Ozempic obesity treatment.

This shift in market dynamics has had a notable impact on Bernard Arnault’s wealth, which had reached a historic high of $212.4 billion in the middle of July. However, as of the latest available data on Thursday, his fortune has dwindled to $170.4 billion. This places him in the second position on the Bloomberg Billionaires Index, trailing behind Elon Musk, whose worth currently stands at $230.7 billion.

It’s worth noting that despite the recent decline, LVMH shares have still managed to maintain an overall positive trajectory for the year, with an increase of approximately 8.8%.

Luxury stocks on decline due to inflationary pressures 

Early in the week the stock declined alongside other luxury stocks with its value dropping below $400 billion following Richemont Chairperson Johann Rupert’s comments that inflation had started to dent dead in the region. Rupert told shareholders that they had seen the squeeze. 

On Wednesday, HSBC Holdings Plc released a report in which they revised their projections and price objectives for the luxury sector. Analyst Erwan Rambourg cited the adjustments as a response to the influence of a strengthening euro and an increased near-term growth cost within the industry.

By Brenda Goh and Ben Blanchard

SHANGHAI/TAIPEI (Reuters) -China’s widening curbs on iPhone use by government staff intensified a sell-off in global tech stocks on Friday on fears Apple and its suppliers could take a hit from rising Sino-U.S. tensions and growing competition from Huawei.

Apple shares tumbled 6.4% in the previous two days, wiping $190 billion from its market capitalisation, following news Beijing ordered some central government employees in recent weeks to stop using iPhones at work.

Several Wall Street analysts on Friday said the selloff was overdone, claiming that any revenue hit for Apple would likely be small due to the phone’s popularity in China. After two days of declines, Apple shares rebounded in Friday trading, up 1.3%.

Apple is facing stepped-up competition from China’s Huawei, which launched two new smartphones – the foldable Mate X5 and the Mate 60 Pro+ – that drew global attention for showcasing resilience to U.S. sanctions.

Some analysts believe Huawei’s moves could be a first step in comeback efforts by China’s “national champion” to rival Apple after it took some market share following U.S. sanctions rolled out four years ago. Apple is set to roll out a new iPhone on Tuesday following a weak quarter for sales of its flagship product.

“We believe Huawei’s activity this time was well prepared and not sudden,” said Ivan Lam, an analyst at Counterpoint, whose outlook for the new products exceeds previous estimation. “It can manage the psychological expectations of the target consumer group before Apple’s press conference.”

China has been a bright spot for Apple, its third-largest market behind the Americas and Europe, in an otherwise tough period for iPhone sales. Huawei’s smartphone business was decimated after the United States curbed tech exports to it in 2019.

Apple’s sales in China this year have been helped by rare deals launched by its third-party retailers in February that offered discounts on its iPhone 14 Pro by as much as 10%. However, analysts told Reuters that those discounts could end up undermining sales of Apple’s new products set to launch in the coming days.

In Taipei, Apple supplier Largan Precision, which makes camera lenses, dropped more than 4%, while contract chipmaker TSMC fell 0.6% on Friday. China’s Luxshare Precision Industry, owner of factories capable of making iPhones, fell 2%.

Shares of U.S.-based Apple suppliers were little changed on Friday, with Qualcomm up 0.1% and Broadcom down 0.4%.

Huawei suppliers extended recent gains. Shares in Semiconductor Manufacturing International Corp (SMIC), which is believed to have made the advanced chip in Huawei’s new smartphone, rose 0.7%.

SCOPE OF CURBS UNCLEAR

It was not immediately clear how wide China’s iPhone curbs are, but one employee at an affected state-owned enterprise (SOE) in the capital said they extended to visitors.

“Anyone, including business visitors, who enters our work area cannot bring in their iPhones,” said the source, one of two SOE employees who said they were told of the ban in recent weeks.

The source, who spoke on condition of anonymity, said the company was giving employees a subsidy of 100-200 yuan ($13-$26) to switch to local brands. Some staff at other SOEs, however, told Reuters they had not been banned from using iPhones.

While the number of central government employees is not public, Bank of America estimated that such a ban could cut iPhone sales by 5 million-10 million units a year from China’s annual total of up to 50 million.

Huawei’s smartphone sales driven by the new Mate 60 Pro could jump 65% this year to 38 million in the absence of some “non-commercial risks,” said Ming-Chi Kuo, an analyst at TF International Securities.

However, Canalys analyst Nicole Peng said Huawei could present a greater threat to domestic peers, and Morgan Stanley’s Erik Woodring on Friday said, “Apple’s ecosystem in China remains very strong,” with the average iPhone owner in China owning 2.5 Apple devices.

Several Wall Street analysts said the curbs showed that even a company with a large presence in China and good ties to the government is not immune to rising tension between the two nations. Apple has shifted some production out of China in the aftermath of the country’s strict COVID-19 restrictions.

“The only way Apple could draw the ire of Beijing is moving supply chains out of China at a pace or to a degree Beijing feels uncomfortable with,” Evercore ISI strategist Neo Wang said in a note.

“If that is the case, it shouldn’t be a surprise for Beijing to punish Apple by playing the ‘security’ card excessively. It is unclear whether what we are seeing now is part of this,” Wang said.

Washington is trying to limit China’s access to key advances, including cutting-edge chip technology, and Beijing wants to cut reliance on American tech.

A teardown by research firm TechInsights showed more China-made chip components in the Mate 60 Pro than previous models, a sign of Beijing’s progress.

The U.S. Commerce Department is seeking more information on the “character and composition” of the new Huawei chip that may violate trade curbs, it said on Thursday.

($1=7.3482 Chinese yuan renminbi)

(Additional reporting by Shanghai Newsroom, Jeanny Kao in Taipei, David Kirton in Shenzhen, Jason Xue in Shanghai, Yelin Mo and Ellen Zhang in Beijing and Sam Nussey in Tokyo; Writing by Miyoung Kim; Editing by Clarence Fernandez and Mark Porter)

By David Shepardson

(Reuters) -United Auto Workers President Shawn Fain said on Friday the union representing 146,000 workers wants a deal to avoid walkouts at the Detroit Three automakers but expects to go on strike against all of them next week if they do not improve their contract offers.

With contracts set to expire next Thursday at 11:59 p.m. ET (0359 GMT next Friday), Fain said the union had rejected General Motors, Ford and Chrysler parent company Stellantis North America and remained far apart.

“We want a deal. We are ready for a deal. But it’s got to be a deal that honors our sacrifices and contributions,” Fain said on Facebook Live. “If we hit 11:59 p.m. on Thursday … there will be a strike at all three, if need be.”

Talks are expected to continue through the weekend.

The union’s self-described “audacious” demands include a 46% pay hike over four years including a 20% immediate wage increase, defined-benefit pensions for all workers, 32-hour work weeks and additional cost-of-living hikes.

Contract talks between the UAW and the Detroit automakers have gone to the strike deadline and beyond in years past. The pace of the negotiations has picked up since Aug. 31 when the union filed unfair labor practice complaints with U.S. labor regulators accusing GM and Stellantis of refusing to make timely economic proposals.

With a trash can labeled “Big Three Proposals” behind him, Fain said the company offers were inadequate – although he noted movement on some points. The automakers started the talks rejecting restoration of cost-of-living adjustments (COLA) pegged to inflation. Now, Ford has proposed what Fain called a “deficient” cost-of-living adjustment formula.

“Suddenly COLA is back on the table,” Fain said.

Stellantis said on Friday it offered U.S. hourly workers a 14.5% wage hike over four years but no lump sum payments.

“This is movement,” Fain said. “We went from 9% at Ford to 14.5% at Stellantis.”

But the Stellantis proposal is still “deeply inadequate,” Fain added.

The UAW said the GM and Ford offers would change the formula for calculating profit-sharing, and if it had been in effect last year GM workers would have received 29% less and Ford workers 21%.

GM said on Thursday it had offered workers a 10% wage hike and two additional 3% annual lump sum payments over four years. Stellantis is not offering additional lump sum payments.

Last week, Ford said it had offered a 9% wage increase through 2027 and 6% lump sump payments. Company officials confirmed on Friday that Ford boosted its offer to 10% in wage hikes along with the lump sum payments.

The Stellantis offer is similar to those made by GM and Ford. It would hike minimum pay for temporary workers to $20 an hour – up $4.22 an hour – and reduce the time necessary to reach top wages for permanent autoworkers from eight years to six years.

“This is a responsible and strong offer that positions us to continue providing good jobs for our employees today and in the next generation here in the U.S.,” Stellantis North America Chief Operating Officer Mark Stewart said in a letter to employees. “It also protects the company’s future ability to continue to compete globally in an industry that is rapidly transitioning to electric vehicles.”

Stellantis is offering $10,500 in inflation protection payments over the four years, while GM is offering $11,000 and Ford $12,000.

A UAW strike that shuts the Detroit Three manufacturers could cost carmakers, suppliers and workers over $5 billion, the Michigan-based Anderson Economic Group estimated.

GM recorded a $3.6 billion pre-tax loss in 2019 after UAW members went on strike for six weeks, the longest walkout against a Detroit automaker since 1970.

(Reporting by David Shepardson in Washington; Additional reporting by Joseph White in Detroit; Editing by Jonathan Oatis and Will Dunham)