POSTING DAYS

Postng Days From Monday to Thursday

Apr 30, 2019

Notification | From The Desk of Fernando Guzmán Cavero

Tomorrow Wednesday 1, May 2019  I won't be on the Internet with you.  I apologize for any inconvenience this might have caused you. I will be backed next Thursday or at The most the following Monday.

Please stay tuned



                                                          Fernando Guzmán Cavero
                                                        


FX | Currencies Price Report | The Dollar on Tuesday 30, April 2019 | Euro hits 1-week peak on upbeat data, dollar retreats

Kelly Olsen




Reusable Australian Dollar AUD b 150223
John Phillips | Digital Editor | CNBC
The euro climbed to a one-week high against the dollar on Tuesday after first-quarter economic growth figures on the euro zone beat market expectations, dispelling some pessimism over the zone’s common currency.
Mixed U.S. data and caution ahead of a two-day Federal Reserve meeting pushed the dollar further away from a near two-year high. Euro zone economic growth accelerated to 0.4% in the first three months of 2019, recovering from a slump in the second half of last year, data showed on Tuesday.
The strong data offered some relief to traders after a disappointing manufacturing PMI survey this month and cautious comments from European Central Bank policymakers raised concerns that the broader economy is struggling to gain traction.
“The (overall) data have been coming in better than expected. The euro is the biggest short in the market right now,” said Steven Englander, global head of G10 FX research at Standard Chartered Bank in New York.
Higher-than-expected growth figures could squeeze some hedge funds who have been amassing large short positions in the euro, worth a net $14.8 billion in the week to April 23.
At 3:10 p.m., the euro was 0.30% higher at $1.1219 after the euro zone growth data. The currency was on track to fall 0.13% in April, bringing its year-to-date loss against the greenback to 2.32%.
An index that tracks the dollar against the euro, yen, sterling and three other currencies was down 0.38% at 97.49. It hit a 23-month high at 98.330 last Friday.
“We feel the dollar-buying move was a bit overdone,” Englander said.
Earlier Tuesday, data showed U.S. labor costs grew 0.7% in the first quarter, reinforcing the notion that wage pressure would stay tame even although hiring has remained strong, the Labor Department said.
Moreover, U.S. Midwest factory activity unexpectedly fell in April to its weakest since January 2017, according to an index from MNI and the Institute for Supply Management-Chicago. Analysts expect no policy changes coming out of the Fed’s two-day policy meeting, which ends on Wednesday, but investors want to hear how Fed Chairman Jerome Powell resolves the divergence between solid economic growth and slowing inflation.
Trading volume was muted by Japanese markets being closed for the Golden Week holiday. Activity will likely drop off further on Wednesday when China and much of Europe will be off for the May Day holiday.
The Japanese yen rallied to a three-week high after China’s official Purchasing Managers’ Index dipped to 50.1 April.
It was up 0.27% at 111.33 yen per dollar.

Source: CNBC

Bonds | Bond Yield Report on Tuesday 30, April 2019 | US Treasury yields tick lower as Fed meeting kicks off

Fred Imbert,Sam Meredith



Treasury yields traded slightly lower on Tuesday as the Federal Reserve kicked off a two-day monetary policy meeting.
The yield on the benchmark 10-year Treasury note traded at 2.504% while the 30-year bond dipped to 2.931%. Yields move inversely to prices.

U.S. Markets Overview: Treasurys chart

The Fed is largely expected to keep rates unchanged, but investors will look for clues about where the central bank thinks the economy is headed.
The central bank’s meeting comes after its preferred measure of inflation, the core personal consumption expenditures index, remained unchanged for March. Labor conditions, however, remain, tight in the U.S.
“Many at the Fed seem to be perplexed (and a bit concerned) by the perceived disappearance of the trade-off between unemployment and inflation,” wrote William DelWiche, investment strategist at Baird. “The recent drop in core inflation rates (as measured by both the CPI and PCE) seems to confirm those concerns and fits a narrative that inflation pressures are easing.”
Expectations for a rate cut at this meeting are just at 4%, according to the CME Group’s FedWatch tool. But the market has fully priced in lower overnight rates by October, FedWatch shows.
But Anwiti Bahuguna, head of multi-asset strategy at Columbia Threadneedle Investments, said the Fed could actually raise rates toward the end of the year as the data remains strong.
“I don’t know how they will communicate that because they have done quite a pivot,” she said. “Communication for them is getting tricky because expectations are so different among market participants.”
Yields also fell after the release of mixed economic data. The Chicago Purchasing Manager Index (PMI) fell to 52.6 from 58.7 in March. Meanwhile, home prices grew at a slower rate in February on a year-over-year basis, according to the S&P CoreLogic Case-Shiller home price index.
Pending home sales rose 3.8% in March, however, thanks in part to a sharp drop in mortgage rates.

Source: CNBC

Wall Street | Wall Street Closing Report on Tuesday 30, 2019 | Nasdaq retreats from record high as Alphabet posts worst day in more than 6 years

Yun Li



Stocks fell on Tuesday as a sharp drop in Google’s parent Alphabet dragged down the communication services sector.
The Nasdaq Composite slid 0.8% after reaching an all-time high in the previous session, while the Dow Jones Industrial Average rose 0.1%.
Alphabet fell 8% and was headed for its worst day since October 2012 after posting revenue of $36.34 billion in the first quarter, versus $37.33 billion expected. The weaker revenue was driven by the decelerating ad sales growth at Google, the company said.
“We acknowledge the uncertainty around the effectiveness of ad product improvements and continued limited transparency company wide, but we also believe there remains multiple monetization opportunities ahead,” JMP Securities analyst Ronald Josey said in a note.
Other stocks had more positive reactions to earnings, however.
Dow-component McDonald’s posted quarterly earnings and revenue that topped analysts’ expectations. Global same-store sales grew 5.4% in the first quarter, more than the 3.4% increase analysts expected, as the burger chain ramped up its promotion programs. The company’s stock rose 0.23%.
General Electric reported better-than-expected first-quarter earnings Tuesday, sending its shares up 4.6%. The company posted earnings of 13 cents a shares, above Wall Street consensus of 9 cents a share, according to Refinitiv. Revenue also came above expectations.
More than half of the S&P 500 companies have reported so far and 77% of them have topped analyst expectations, according to Refinitiv. If all remaining companies report numbers in line with estimates, earnings growth will be up 0.7% year over year, which contrasts the 2% decrease expected as recently as April 1.
“Earnings sentiment has improved in April, with a slight bias towards upward revisions,” Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets, said in a note on Monday. “The macro backdrop/underlying demand were simply not nearly as bad as feared in 1Q19... We think Corporate America did everything within its powers in 1Q19 to support earnings growth and defend margins.”
Dow-member Apple is slated to report earnings after the bell Tuesday. Its shares traded down 2% ahead of the release.
Investors also digested the latest development on the trade front. White House chief of staff Mick Mulvaney said Tuesday the Trump administration’s trade talks with China will be resolved within the next two weeks.
This week’s focal point will be the Federal Reserve’s policy decision and press conference on Wednesday. Fed watchers will be closely monitoring if the central bank changes its dovish tone and how it plans to proceed with its balance sheet reduction program.
“Their goal is going to be to move away from the limelight and be on hold for the rest of the year,” said Mark Heppenstall, chief investment officer at Penn Mutual Asset Management. “My guess is a stable Fed leads to more stable markets. Maybe risk assets keep grinding higher at this point.”
The fed funds futures market is seeing no rate hikes coming this year, while assigning a 57 percent probability of at least one rate cut by Dec. 11, according to the CME’s FedWatch tool.
— CNBC’s Silvia Amaro contributed to this report.

Source: CNBC

Energy | Oil | Oil Price Report on Tuesday 30, April 2019 | Oil prices rise on Venezuela turmoil, Saudi support for OPEC cuts

Tom DiChristopher




Reusable CNBC: Oil derrick pump jack Midland Texas west Texas 150825-001
Oil prices rose on Tuesday as Venezuela’s opposition leader called on the military to back him to end Nicolas Maduro’s rule and after Saudi Arabia said a deal between producers to withhold output could be extended beyond June to cover all of 2019.
The situation in Venezuela, an OPEC member whose oil exports have been hit by U.S. sanctions and an economic crisis, was fluid on Tuesday. The government promptly dismissed any suggestion of a military insurrection.
The statements by Saudi energy minister Khalid Al-Falih came despite pressure by U.S. President Donald Trump to raise output to make up for a supply shortfall expected from tightening U.S. sanctions against Iran.
“There was an uptick even without Venezuela due to Falih’s comments,” said analyst Olivier Jakob at Petromatrix
Brent crude futures were up 84 cents, or 1.2, at $72.88 per barrel around 11:55 a.m. ET (1555 GMT). U.S. West Texas Intermediate crude futures rose 55 cents, or nearly 1 percent, to $64.05 per barrel.

Falih’s comments, made to Russian state news agency RIA, suggested Saudi Arabia would want to maintain some form of production cut despite Trump’s demand.
A Reuters survey of OPEC oil supply found production from the group hit a four-year low in April of 30.23 million barrels per day due to further involuntary declines in Iran and Venezuela and continued Saudi output restraint.
The existing deal involves a cut by the Organization of the Petroleum Exporting Countries and other allies led by Russia of around 1.2 million bpd until the end of June.
OPEC and its allies meet in Vienna on June 25-26 to decide on the next steps.
Brent hit a six-month high above $75 last week because of tightening global markets amid U.S. sanctions on Iran and Venezuela coupled with Russian oil export problems stemming from a contaminated pipeline.
Belarus said on Tuesday that months of work would be needed to restore clean oil supplies via the Druzhba pipeline after Western oil consumers suspended imports of Urals crude due to contamination.
Druzhba can pump up to 1 million barrels bpd, amounting to 1 percent of global crude demand.
Bank of America Merrill Lynch said “Iranian oil production will fall to 1.9 million barrels per day in 2H19 from 3.6 million barrels per day in 3Q18 as U.S. sanctions kick in and waivers eventually expire”.
Despite this, the bank said it expected “a nearly balanced market in 2019” as output from OPEC and also the United States will rise.
French bank BNP Paribas said it expected oil prices “to rise in the near-term” as crude producers were “over-tightening the market in the face of unplanned supply outages and resilient oil demand.”
BNP said it expected crude markets to climb until the third quarter of 2019, adding that prices would then “start to become vulnerable to a sharp rise in U.S. exports of light crude thanks to pipeline and terminal capacity expansion.”
Prices had come under downward pressure earlier on Tuesday after data on China’s factory activity weighed on financial markets, including crude oil futures, as it suggested Asia’s biggest economy is still struggling to regain traction.

Source: CNBC

Gold | Gold Price Report on Tuesday 30, April 2019 | Gold edges up as weak Chinese data dampens risk sentiment

Sam Meredith




RT: Gold ingots Russia 170922
Gold prices edged up on Tuesday as disappointing Chinese factory activity data brought back concerns about the health of the global economy, denting risk appetite.
Spot gold rose 0.4 percent to $1,285 per ounce. U.S. gold futures were up 0.4 percent at $1,286.20 an ounce.
“The weaker Chinese PMI is a supportive element and aiding gold. Also, from a technical point of view, we have seen a rebound from $1,280, which is a good support level,” said Carlo Alberto De Casa, chief analyst with ActivTrades, adding that a weaker dollar was also helping gold.
”(I) don’t see much room for decline in prices from here and only the strength of the U.S. dollar can hurt gold.”
European equity markets nudged down on Tuesday, following weaker Asian stock markets as the latest Chinese data pointed to some fragility in the world’s second-largest economy despite Beijing’s attempts to spur growth.
Gold is generally used by investors as a safe-haven investment in times of economic and political concerns.
Investors now look to the U.S. Federal Reserve’s two-day policy meeting starting later in the day for clues on the interest rate outlook.
The Fed is expected to leave interest rates unchanged as it seeks to balance robust economic growth against low inflation.
Gold is highly sensitive to rising interest rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
While the Fed’s decision will boost bullion’s appeal, the metal is yet to overcome bearish factors, and any rallies may be short-lived, traders and analysts said.
“The yellow metal remains toppish toward $1,290 and is likely to continue to see bears weigh upon rallies over the near-term as the recent downtrend remains intact,” MKS PAMP Group said in a note.
“Downside targets through to $1,275-$1,270 remain in play over the near term as the metal sees muted physical interest out of Asia this week due to both Chinese and Japanese festivities.”
Elsewhere, silver gained 0.6 percent to $14.99 per ounce, while platinum rose 0.5 percent to $899.
Palladium, on the other hand, fell 0.4 percent to $1,365.50 an ounce, after touching its lowest in nearly two weeks at $1,354. The metal slumped over 7 percent on Monday.

Source: CNBC

Europe | Europe Closing Report on Tuesday 30, April 2019 | European markets close mixed as euro zone GDP beats expectations; AMS shares jump 21%

Chloe Taylor, Sam Meredith



European stocks were slightly lower on Tuesday, as signs of economic growth in the euro zone failed to outweigh weaker-than-expected Chinese data.

European Markets: FTSE, GDAXI, FCHI, IBEX

TICKER COMPANY NAME PRICE CHANGE %CHANGE VOLUME
FTSEFTSE 100FTSE7405.65-35.01-0.47391717860
DAXDAXDAX12303.92-24.10-0.2047525817
CACCACCAC5565.66-15.32-0.2848338084
The pan-European Stoxx 600 was down around 0.2% during afternoon deals, with most sectors and major bourses in negative territory.
Europe’s basic resources stocks — with their heavy exposure to China — led the losses, down 1.8%. Glencore was the among the worst performers, trading almost 4% lower.
Looking at individual stocks, chipmaker AMS surged to the top of the European benchmark during morning trade. It comes after the Apple supplier reported an upbeat outlook for the second quarter, driven by a rising number of Android smartphones using its 3D optical sensors. Shares of the Austrian group jumped 18% on the news.
Meanwhile, Danske Bank tumbled to the bottom of the index, after the embattled lender posted earnings below expectations and slashed its outlook for the remainder of the year. Shares of Denmark’s biggest bank dipped by 8%.
British oil giant BP reported earnings largely in line with expectations Tuesday morning. The London-based oil and gas firm said first-quarter underlying replacement cost profit — used as a proxy for net profit — came in at $2.4 billion, versus $2.3 billion expected in a Reuters poll. Shares of BP were 1.3% higher.
Elsewhere, Standard Chartered’s shares rose almost 5% after the bank unveiled plans for a $1 billion share buyback scheme. The announcement came as the company posted a 10% rise in quarterly profit.
Shares of Airbus were 1.4% lower after the aerospace group posted slightly higher than expected core first-quarter profits.
On the data front, euro zone economic growth came in stronger-than-anticipated over the first three months of the year, while unemployment fell to its lowest level in more than a decade.
Official data from the EU’s statistics office Eurostat said a preliminary estimate of first-quarter GDP (gross domestic product) rose 0.4%, up from 0.2% in the final three months of 2018.
Fed in focus
Official and private business surveys published Tuesday showed the manufacturing sector in the world’s second-largest economy expanded at a slower pace than analysts had expected in April. The weak data, which also showed a slower rate of growth in Beijing’s services sector, added to economic uncertainty.
Stateside, the U.S. central bank’s Federal Open Market Committee (FOMC) is due to announce its latest monetary policy decision on Wednesday. The Federal Reserve is widely expected to hold interest rates steady, as it seeks to balance robust economic growth against low inflation.
Stocks on Wall Street were trading lower on Tuesday, as investor sentiment was dented by a weak revenue report from Google parent company Alphabet.

Source: CNBC

Europe Markets | Bank of England deputy governor warns against curbing financial regulations post-Brexit

Elliot Smith




RT: Bank of England pedestrians walk by 160628
Pedestrians walk past the Bank of England in the City of London, Britain June 28, 2016.
Paul Hackett | Getty Images
Light touch financial regulation after the U.K. leaves the European Union will not help the British financial sector, according to a deputy governor at the Bank of England.
Speaking to CNBC’s Joumanna Bercetche at the Innovate Finance Global Summit in London, Deputy Governor for Markets and Banking Dave Ramsden indicated that adopting light touch regulation to gain a competitive advantage for the U.K. financial sector after Brexit was not on the agenda.
Ramsden said it was important that the Bank of England retained focus in its core mission of ensuring the soundness of individual banks and the overall financial system, especially 11 years on from the start of the financial crisis.
“The lessons we have learned from that are that it’s incredibly important to always maintain the right regulation and certainly not think of reducing the regulatory stance for some kind of competitiveness reason,” said Ramsden.
“That won’t actually be good for the U.K. financial sector and won’t be good for the burgeoning fintech sector in the U.K.,” he added.
Ramsden also discussed the importance of the central bank keeping up with technological developments in banking and insurance by using artificial intelligence and the vast amount of data it gathers from companies “to make parts of the regulatory process more straightforward.”
“Given that we take a judgment-based approach to regulation, it will enable us to focus our efforts more on making those appropriate judgments so that we get the stance of regulation right.”

Source: CNBC

Market Insider | Stocks making the biggest moves premarket: Alphabet, General Electric, MGM Resorts & more

Fred Imbert



Check out the companies making headlines before the bell:

Alphabet — The Google-parent reported better-than-expected earnings but its stock dropped nearly 8% in the premarket after posting a slowdown in advertising revenue growth. The company said its ad revenue grew by 15.3% in the first quarter, down from 24.4% in the year-earlier period.
General Electric — The industrial giant reported better-than-expected quarterly results as the company works to simplify its business and turn around the company. CEO Larry Culp also reaffirmed General Electric’s 2019 forecast, sending the stock up 8.5%.
AK Steel — Shares of the steel company rose 3.7% in the premarket after reporting earnings per share for the previous quarter that beat expectations. The company’s results got a boost from higher prices.
MGM Resorts International — The casino operator’s stock fell 3.2% on a big miss on quarterly earnings. MGM posted a profit of 5 cents per share, while analysts polled by Refinitiv expected earnings of 21 cents per share.
Western Digital — Shares of the data storage company fell about 5.5% on the back of weaker-than-expected fiscal third quarter results. Western Digital posted adjusted earnings per share of 17 cents on revenue of $3.67 billion. Analysts expected a profit of 46 cents per share on sales of $3.68 billion.
Yum China — Yum China posted first-quarter numbers that topped estimates amid strong performances from key businesses like KFC and Pizza Hut. The company posted adjusted earnings per share of 59 cents on revenue of $2.3 billion. Analysts polled by Refinitiv expected a profit of 54 cents per share on sales of $2.26 billion. Same-store sales rose 4% in the quarter, well above a forecast of 1.8%.
ConocoPhillips — ConocoPhillips shares rose 1.5% on the back of better-than-expected earnings and revenue. The company earned $1 per share on revenue of $10.1 billion. Analysts had forecast a profit of 90 cents per share and revenue of $9.039 billion.
Eli Lilly — Eli Lilly reported quarterly earnings that topped expectations and raised its full-year profit guidance. However, the stock fell more than 3% as revenue came in just below expectations.
McDonald’s — The Dow Jones Industrial Average component posted stronger-than-forecast results for the first quarter as same-store sales grew at a stronger pace than expected. McDonald’s earnings came in at $1.78 per share, 3 cents above a Refinitv estimate. Sales for the company totaled $4.956 billion, topping a $4.933 billion forecast.
MasterCard —The credit card company posted quarterly earnings and revenue that topped analysts’ expectations, sending its stock up more than 1%. MasterCard reported earnings per share of $1.78 on revenue of $3.899 billion. Analysts polled by Refinitiv expected a profit of $1.66 per share on revenue of $3.856 billion.

Source: CNBC

Employment Costs Index News Release | Compensation costs up 0.7% Dec 2018 to Mar 2019 and up 2.8% over the year ending Mar 2019

Compensation costs increased 0.7 percent for civilian workers, seasonally adjusted, from December 2018 to March 2019. Over the year, compensation rose 2.8 percent, with wages and salaries rising 2.9 percent, and benefit costs rising 2.6 percent.
HTML | PDF | RSS | Charts

Source: BLS

Investing | the biggest analyst calls of the day: Alphabet, Bank of America, Disney & more

Michael Bloom



Here are the biggest calls on Wall Street on Tuesday:
Stifel downgraded Alphabet to ‘hold’ from ‘buy’
Stifel downgraded the stock and said it sees “lower visibility” on revenue growth.
“We view shares as fairly-valued at current levels and believe the multiple is likely to remain range bound over the next twelve months as a potential deceleration digestion period lies ahead with lower visibility into near-term revenue growth rates. The upside to Street margin in 1Q would be an encouraging trend all else equal, though the topline deceleration path and questions regarding Alphabet’s long-term revenue growth trajectory are likely more meaningful to intermediate-term stock performance in our view, while discretionary spending could also cause opex to tick up again in future quarters. At aftermarket prices, GOOGL shares trade at approximately 22x our 2020E GAAP EPS, matching the three-year historical average of 22x forward two-year EPS. ”
Read more here.
Atlantic Equities downgraded Bank of America to ‘neutral’ from ‘overweight’
Atlantic Equities downgrade the stock mainly on valuation after Bank of America’s recent earnings report.
“Although peak NIM concerns resurfaced during the US banks’ Q1 reporting season, the over-riding message was positive with credit remaining benign, costs well controlled and core loan growth steady. Trading revenues were also better than feared and management provided positive commentary around the near-term outlook. We are downgrading BAC to Neutral (from Overweight) following the 25% rise YTD and with the valuation back to a more normalised level. Our forecast FY19 EPS changes range from +4% (JPM) to -6% (WFC). Citi and MS remain our top picks in the sector.”
Bernstein initiated Zoom as ‘outperform’
Bernstein said among other things that the company has underappreciated earnings potential. Zoom provides remote conferencing services using cloud computing.
“We are initiating coverage on Zoom Video Communications with an Outperform rating and a 1-year target price of $89. We forecast revenue and FCF growth CAGRs of 38% and 74% (FY20-26), respectively. Our bullish investment thesis is based on four pillars: 1)Large and growing TAM of $40B+. 2) Long-term sustainable share gains in video conferencing, collaboration tools, and VOIP services, driven by superior technology, ease of use, simplicity of IT management, and cost competitiveness. 3) Upside surprises on revenue, driven by continued enterprise penetration and international expansion, with Zoom phone as a free call option for longer-term growth. 4) Underappreciated LT earnings potential, driven by superior growth efficiency and structural cost advantages. ”
Citi raised its price target on Disney to $160 from $132
Citi said it is bullish on Disney+ and its direct to consumer business.
“With the Investor Day behind us (and Avengers in theaters), investors wonder if there are any remaining catalysts for the shares. We see two: 1) We expect Disney to acquire the 33% of Hulu currently held by Comcast and 2) The two Star Wars parks open up in 2019: Disneyland opens in May and Disney World opens in August. Recall, Disney benefitted from a multi-year lift in attendance when Cars Land opened at Disneyland in 2012. ”
Loop Capital upgraded Dollar General to ‘buy’ from ‘hold’
Loop said Dollar General has several “compelling” top-line growth and profit margin expansion drivers.
“We are upgrading Dollar General to a Buy from a Hold rating while boosting our price target to $152 from $105, implying 22% upside from current levels. We believe Dollar General currently has three compelling top-line growth and profit margin expansion drivers: (1) the recent addition of Western Union (WU:$19.41-NR) services; (2) the DG Fresh fresh and frozen goods self-distribution initiative; and (3) the Fast Track supply chain and self-checkout initiative. As a result, we expect Dollar General’s operating margin to expand for the first time in five years in F2020. Our price target is based on 20.7x our F2020 diluted EPS estimate. ”

Source: CNBC

Business News | Vodafone found security flaws in Huawei equipment in 2011, 2012

4-5 minutes



LONDON (Reuters) - Telecoms group Vodafone found security flaws in equipment supplied by China’s Huawei to its Italian business in 2011 and 2012, the two companies said on Tuesday.
FILE PHOTO: The Logo of Huawei is seen at its showroom in Shenzhen, Guangdong province, China March 29, 2019. REUTERS/Tyrone Siu/File Photo
Vodafone, the world’s second-biggest mobile operator, said it had found security vulnerabilities in two products and that both incidents had been resolved quickly.
Huawei, the world’s biggest producer of telecoms equipment, is under intense scrutiny after the United States told allies not to use its technology because of fears it could be a vehicle for Chinese spying. Huawei has categorically denied such accusations.
Vodafone paused the deployment of Huawei equipment in its core networks in January as the British group waits for Western governments to give the Chinese company full security clearance.
Last week Britain sought to navigate its way through the bitter dispute, with two security sources telling Reuters that it had decided to block Huawei from all core parts of its 5G network and restrict access to non-core parts.
The British government is still deliberating on the use of Huawei equipment in a future 5G network but aims to announce its decision in the next month.
A government report in March rebuked Huawei for failing to fix long-standing security issues and said that British security officials had found “several hundred vulnerabilities and issues” with the company’s equipment in 2018.
However, mobile operators such as Vodafone have warned that a complete ban on Huawei would delay 5G, which will offer much faster data speeds and underpin future development in many industries, such as self-driving cars.
The two companies said they had found software vulnerabilities in 2011 and 2012 that were fixed by Huawei.
Vodafone said it had found no evidence of any unauthorized access and that Huawei could not have accessed the fixed-line network in Italy without permission.
“The issues were identified by independent security testing, initiated by Vodafone as part of our routine security measures, and fixed at the time by Huawei,” a Vodafone spokesman said.
Huawei said it was made aware of historical vulnerabilities in 2011 and 2012 and that they had been addressed at the time.
“Software vulnerabilities are an industry-wide challenge,” it said. “Like every information and communications technology vendor we have a well-established public notification and patching process, and when a vulnerability is identified we work closely with our partners to take the appropriate corrective action.”
Vodafone said the vulnerability had stemmed from the use of Telnet, a protocol that was commonly used by many vendors for performing diagnostic functions. It allows equipment manufacturers to communicate with their products after they have been deployed.
“It would not have been accessible from the internet,” Vodafone said.
The news of the historical flaws was first reported by Bloomberg.
Spokesmen for the British government’s digital department and for the National Cyber Security Centre declined to comment.
BT, Britain’s biggest fixed and mobile operator, said that over the course of more than 10 years of working with Huawei it had not identified any security breaches or evidence of unsolicited communications.
Huawei competes with Sweden’s Ericsson and Finland’s Nokia.
Reporting by Kate Holton and Jack Stubbs; Editing by Louise Heavens and David Goodman

Source: Reuters

Analysis | The Cybersecurity 202 | Here are the 55 things the U.S. government most needs to protect against cyberattacks

By Joseph Marks



PowerPost Analysis
Analysis Interpretation of the news based on evidence, including data, as well as anticipating how events might unfold based on past events

THE KEY

Christopher Krebs, director of the Department of Homeland Security's Cybersecurity and Infrastructure Security Agency. (Evan Vucci/AP)
The Department of Homeland Security is releasing today a list of 55 things the government most needs to protect from digital attacks.
The government believes that a cyberattack on any of these government or private sector services or functions could have a “debilitating effect” on national security, the U.S. economy or public health.
On the list, provided first to The Cybersecurity 202, are some obvious things -- such as supplying water or generating electricity. But the list also delves into some broader categories, including preserving Constitutional rights, protecting sensitive information, and enforcing the law. The list includes everything from providing internet access to supporting community health and conducting elections. You can read the full list here.
The U.S. has long relied on a system that prioritized protecting industry sectors --  such as transportation, financial services and energy -- as part of its critical infrastructure. But these broad categories are proving far too imprecise in an age when, say, North Korea launched a destructive attack on a film studio and Russia orchestrated a sweeping election inferference campaign.
The plan is part of a broader DHS effort to shift to a “risk-based” approach to cybersecurity — in other words, devoting more time and money to threats that could do the most damage.
"If everything’s a priority, then nothing’s a priority,” Director of DHS’s Cybersecurity and Infrastructure Security Agency Chris Krebs told me. “This allows us to really drill down into those things we need to care about.”
A main benefit of the new system is that it will allow government and industry to map out how a single digital threat — say an attack on the Global Positioning System or Internet routing services — might ricochet across numerous industries, Krebs said.
DHS’s previous system for categorizing digital threats focused on 16 critical infrastructure sectors but didn’t deal with the complex web of interdependence between them. And it didn't distinguish between truly vital systems, like those that deliver electricity, versus less vital ones, such as that electric utility's public-facing website.
“[Now] we can focus on … the gaps and overlays between [industry] sectors,” Krebs said. “We want to back out from these artificial economic sectors into something more focused on what [industries] actually deliver at the end of the day.”
Instead of listing the healthcare sector, for example, the new critical functions list includes systems that “maintain access to medical records” and that “support community health.” And instead of transportation, it lists transporting cargo and passengers by air, rail, road, mass transit and vessels -- and materials by pipeline.
The department also plans to work with industry to identify which functions are the most critical of the critical. The department will use that prioritized list — which it may or may not make public — to frame conversations with industry about cybersecurity tactics and to guide DHS’s budget requests to Congress, Krebs said.
“Not all [55] functions are created equal in terms of priority, so you can start triaging, putting the most critical ones at the top, figuring out where do we want to put our scarce resources,” he said.
You are reading The Cybersecurity 202, our must-read newsletter on cybersecurity policy news.
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PINGED, PATCHED, PWNED

President Trump speaks during a Make America Great Again rally. (William Glasheen/Post-Crescent/AP)
PINGED: President Trump’s lack of interest in election security and his unwillingness to condemn Russian hackers “has made it tougher for government officials to implement a more comprehensive approach to preserving the integrity of the electoral process,” my colleagues Josh Dawsey, Ellen Nakashima and Shane Harris report.
“For more than two years…Trump has recoiled when aides broached Russia’s 2016 theft and dissemination of Democratic emails and its ma­nipu­la­tion of social media in an effort to sway the election,” my colleagues report.
During one 2017 meeting with advisers, Trump called the hacking operation – which the intelligence community attributed to Russia – “a goddamn hoax,” my colleagues reported.
The president also regularly conflates discussions about Russia’s interference in the election with attacks on the legitimacy of his election, current and former officials said.
 “In one meeting in late summer 2018 in the Situation Room, aides told Trump that they wanted to talk publicly to raise voters’ awareness of the interference ahead of the midterm,” my colleagues reported. “According to an official familiar with the meeting, Trump placed a condition on any public statements: The aides must also make clear that Russia didn’t influence his win.”

Huawei CEO Richard Yu stands during the presentation of the new Huawei P30 smartphone, in Paris. (Thibault Camus/AP)
PATCHED: Washington doesn’t believe there’s any safe way to allow Huawei inside next-generation 5G wireless networks without enabling Chinese spying, the State Department’s top cybersecurity diplomat Robert Strayer told reporters in Brussels on Monday, the Wall Street Journal’s Parmy Olson reported.
The statement comes less than a week after the United Kingdom decided to let Huawei construct noncore portions of its 5G networks.
Strayer didn’t directly address the U.K. decision, the Journal reported. “But asked about whether the U.S. and the U.K. were aligned on what constitutes vulnerable parts of a network, he said: ‘no part of a 5G network should have parts or software coming from a vendor that could be under the control of an authoritarian government,’” the Journal reported.
The United States has lobbied numerous allies to ban Huawei from their 5G networks but with limited success. Only Australia has fully barred the Chinese telecom so far. The Trump administration has also not yet released its own order barring Huawei from U.S. 5G networks.

A workman dusts the floor at the Central Intelligence Agency headquarters in Langley, Va. (AP Photo/J. Scott Applewhite, File)
PWNED: A jailed former CIA computer engineer who’s accused of leaking a massive trove of hacking tools made a series of claims in a legal filing asking to be released from federal detention that many on Twitter noted were outlandish. 
Joshua Schulte, who’s accused of passing the documents known as Vault 7 to WikiLeaks, claimed he’s lost $50 billion during his incarceration, according to independent journalist Marcy Wheeler.
Here's the logic behind Schulte's claim of $50B in lost income: Basically, his incarceration is preventing him from becoming the next Bill Gates. pic.twitter.com/FbIsfI8kOS
— emptywheel (@emptywheel) April 26, 2019
Schulte also “lost time mentoring and teaching my youngest brother programming as he attends college and most likely learns the wrong way to align braces and indent,” according to the filing quoted by Cyberscoop’s Jeff Stone.
He’s “also a huge movie buff and I’ve already missed major blockbuster releases that I would have reserved in advance at Alamo Drafthouse and enjoyed with family and friends,” the filing states.
Schulte was first charged with storing child pornography in 2017. He was later charged with the Vault 7 leak under the Espionage Act.
Here's more on that from Wheeler:
Along with Espionage for leaking live hacking tool, Schulte is accused of possessing child porn and (in VA state charges) sexual assault.
He says he is accused of a victimless crime. pic.twitter.com/GTM3Wqr6WX
— emptywheel (@emptywheel) April 26, 2019
PUBLIC KEY
Cybersecurity news from the public sector:

Secretary of State Mike Pompeo said Monday he expects Russia will try to interfere in U.S. elections for decades to come, describing Moscow as having long presented a threat to American elections — not just in 2016.  
The Hill

The “Russia Small Group” — whose existence NSA Director Paul Nakasone announced in July of last year — will thwart Russian influence and cyberattacks.
Cyberscoop
PRIVATE KEY
Cybersecurity news from the private sector:

The ‘hidden backdoors” reportedly could have been used to spy on Vodafone’s infrastructure. Huawei says otherwise.
ZDNet

Facebook is kicking off its annual conference for developers on Tuesday with a keynote from CEO Mark Zuckerberg expected to share more details about his new, “privacy-focused” vision for the social network.
Barbara Ortutay | AP

The future of wireless technology holds the promise of total connectivity. But it will also be especially susceptible to cyberattacks and surveillance.
The New Yorker

Earlier this month, Motherboard revealed that Microsoft's email services were compromised. Multiple victims now say that hackers stole their cryptocurrency.
Motherboard

U.S. officials are reviving concerns about the security of a vital component of the electric grid: the large transformers that power cities and regions. Are those security concerns valid or overhyped? 

The Americas | Venezuelan opposition leader Juan Guaidó appears to stage military-backed challenge to President Maduro

By Mariana Zuñiga 




Venezuelan opposition leader Juan Guaido speaks with a military member near the Generalisimo Francisco de Miranda Airbase, "La Carlota," in Caracas, Venezuela, April 30, 2019. (REUTERS/Manaure Quintero )

Anthony Faiola
Correspondent covering Latin America, Venezuela, Argentina, Brazil, human rights, poverty, globalization and economics
CARACAS, Venezuela — Venezuelan opposition leader Juan Guaidó appeared early Tuesday to be staging a military-backed challenge to President Nicolás Maduro, issuing a video with troops that he said was recorded at a base in Caracas and urging other soldiers to join the final stage of “Operation Liberty” meant to force the socialist leader from power.
“People of Venezuela, the end of usurpation has arrived,” Guaidó said. “At this moment, I am with the main military units of our armed forces, starting the final phase of Operation Liberty. People of Venezuela, we will go to the street with the armed forces to continue taking the streets until we consolidate the end of usurpation, which is already irreversible.”
Maduro’s communication’s minister tweeted that the government was moving to confront a “coup” and was attempting to “deactivate” what he described as a “reduced group of military officials who are traitors” and who have positioned themselves in the Altamira district of the capital.
Maduro’s defense minister, Vladimir Padrino Lopez, insisted in a separate tweet that the majority of the military remains loyal to the government.
“The Bolivarian Armed Forces stand firm in defense of the national constitution and its legitimate authorities,” he tweeted. He added: “We reject this coup-like movement that seeks to fill the country with violence. The pseudo political leaders that are heading the subversive movement have employed troops and police with war weapons in a street of the city to create terror.”
Guaidó called for “nonviolent” action, but the video had the hallmarks of perhaps the most significant military challenge to Maduro’s power since Guaidó — the head of the opposition-controlled National Assembly — invoked constitutional powers, called Maduro a usurper and claimed the true mantle of leadership as Venezuela’s interim president. His claim has since been recognized by nearly 60 nations, including the United States, which is vigorously backing him and has called on Venezuela’s military to reject Maduro.
On Tuesday — a day before a planned opposition protest — Guaidó stood in front of Leopoldo López, his political mentor and a longtime opposition figure who has been ordered to remain under house arrest. His presence signified a defiant breaking of that order.
“Venezuela: the final phase for the end of usurpation has arrived, Operation Freedom,” Lopez tweeted. “I have been freed by military men of the constitution, and of President Guaidó. I’m at the La Carlota Base. We have to mobilize. It’s time to conquer freedom. Strength and Faith.”
Officially known as Generalísimo Francisco de Miranda Air Base, the La Carlota base was built in 1946 in the eastern part of Caracas. Its airport has been closed to the public since 2005.
The early-morning events set the stage for a potentially dramatic confrontation between Maduro’s government and Guaidó’s backers.
“The assassin ultra-right joined this attempt, announcing its violent agenda months ago,” Jorge Rodriguez, Maduro’s communication minister, tweeted. “We call the people to stay in maximum alert with the glorious Bolivarian armed forces to overcome this coup attempt and preserve the peace.”
Sen. Marco Rubio (R-Fla.), who has strongly backed Guaidó, issued a call for the military to rise up: “This is the moment for those military officers in #Venezuela to fulfill their constitutional oath & defend the legitimate interim President @jguaido, in this effort to restore democracy,” he tweeted. “You can write history in the hours & days ahead.”
Faiola reported from Miami.
Read more:

Health News | Novartis's Sandoz strikes deal for biosimilar of Herceptin

1-2 minutes



FILE PHOTO: Swiss drugmaker Novartis' logo is seen at the company's plant in the northern Swiss town of Stein, Switzerland October 23, 2017. REUTERS/Arnd Wiegmann/File Photo
ZURICH (Reuters) - Novartis’s Sandoz division has struck a deal with Taiwan’s EirGenix Inc to market a biosimilar version of Roche’s Herceptin that is now in late-stage development to treat some cancer tumors.
Novartis said the accord covers the trastuzumab biosimilar in Phase III development for human epidermal growth factor receptor 2 positive (HER2+) breast and gastric tumors.
EirGenix will be responsible for development and manufacturing, while Sandoz has the right to commercialize the product in all markets except China and Taiwan.
EirGenix will receive an upfront payment, milestone payments, and a share of profits from sales, Novartis said, giving no more financial details.
The deal - the third biosimilar collaboration for Sandoz in 18 months - expands the existing Sandoz cancer portfolio of four oncology biosimilar medicines.
Reporting by Michael Shields; editing by Jason Neely

Source: Reuters

Markets | Small Caps Stand to Benefit From Stronger Dollar

The Wall Street Journal.
Markets Bull logo.
Markets
Good morning, I'm Jessica Menton, here with your daily market update.
Alphabet shares are dropping premarket after the Google parent posted its slowest quarterly revenue growth since 2015. Investors will turn their attention to earnings from General Electric, Eli Lilly and Merck ahead of the opening bell. Tech giant Apple headlines companies reporting results after the market closes.
As stocks wrap up the final trading day of the month, I explore why small-cap shares are facing a critical test.
 

Markets in a Minute

Markets Data
 

Overnight Developments

  • Global stocks wavered after Wall Street hit a new closing high, raising questions about how much longer the rally can continue.
  • Read our full market wrap here
 

Dollar’s Climb Could Boost Small-Cap Stocks

The broader market could benefit from a small-cap rally, some investors say
A resurgence in the dollar potentially bodes well for one group that has struggled to reclaim record territory after last year’s rout: small-cap stocks.
The Russell 2000 index of small-capitalization stocks remains 8.2% below its August record, while larger peers have recently topped their all-time highs following a bruising fourth-quarter selloff. The S&P 500 and Nasdaq both tallied new records on Monday, while the Dow Jones Industrial Average sits 1% away from its October closing high.
But a recent bounce in the U.S. dollar and tepid inflation could help boost small-cap stocks, which are more tied to the domestic economy than their larger counterparts. Meanwhile, Federal Reserve officials are widely expected to leave interest rates unchanged at their meeting this week, which could help small companies. As interest rates climb, so do the cost of the loans small businesses carry.
Small caps, which typically have a market value of about $2 billion or less, are at an important juncture. The Russell 2000, which has climbed 19% this year, is outpacing the S&P 500's 17% rise. Although the Russell 2000 rebounded in early 2019, it has struggled to stay above 1600, a key resistance level. How small-cap stocks perform in the near term could be a telling sign for the trajectory of the broader market this year, some analysts said.
Eric Marshall, portfolio manager of the Hodges Fund, which includes both large and small companies, said the firm has bought small-cap stocks this month across a broad array of sectors including financials, consumer discretionary, technology and health care.
“We do think you can find opportunities in small caps, in particular some of the beaten-down financial stocks, technology in both software and semiconductors, as well as some of the more cyclical areas like homebuilding,” Mr. Marshall said.
A rise in the dollar has made some analysts more optimistic. Small caps are more insulated from a stronger dollar than larger companies because their revenues are more likely to come from inside the U.S. Meanwhile, larger multinationals have more exposure overseas, making foreign revenues smaller when converted back to dollars.
The dollar climbed to its highest level of the year last week, boosted by better-than-expected economic data. The WSJ Dollar Index, which gauges the U.S. currency against a basket of 16 others, slipped 0.1% Monday to 90.81. Since the dollar first hit a fresh 2019 high on April 23, the Russell 2000 has climbed 2.5%.
To be sure, small-cap stocks still look pricey to some investors. The Russell 2000 trades at 35.6 times projected earnings over the next 12 months, higher than its 10-year average of 29.7, according to FactSet. The S&P 500, meanwhile, is trading at 19.2 times projected earnings, up from its 10-year average of 17.6.

Market Facts

  • Heading into Tuesday's trading, the S&P 500 and the Nasdaq this year have climbed 17% and 23%, respectively, putting both indexes on pace to notch their largest four-month percentage gains since December 2010. The Dow has climbed 14% so far this year and is also on track for its biggest four-month percentage rise since January 2018.
     
  • Alphabet shares slid 7% on Monday in after-hours trading after the Google parent posted first-quarter revenue of $36.3 billion, roughly $1 billion short of forecasts. If the losses hold through the close of today's trading, it would mark the stock's largest percentage loss since October 2012, when it dropped 8%.
     
  • On this day in 1999, Priceline.com, which had gone public at $16 a share exactly one month earlier, closed the day at $162.38—giving the internet company a one-month return of 915% and a total market value of $23 billion. But it was all downhill from there. Priceline ended up trading for less than $6 per share by October 2000. The company rebranded itself as Booking Holdings in 2018 and is once again one of the move valuable American tech companies.

Key Events

Germany's consumer-price index for April is out at 8 a.m. ET.
The U.S. employment-cost index for the first quarter is expected to increase 0.8% from the prior quarter. The figures are out at 8:30 a.m.
The S&P/Case-Shiller home-price index for February, out at 9 a.m., is expected to rise 2.8% from a year earlier.
The Chicago purchasing managers index for April, slated for 9:45 a.m., is expected to tick up to 58.8 from 58.7 a month earlier.
The Conference Board's consumer-confidence index for April, released at 10 a.m., is expected to rise to 126.0 from 124.1 a month earlier.
U.S. pending-home sales for March, also out at 10 a.m., are expected to rise 1.5% from the prior month.
President Donald Trump is set to meet with House Speaker Nancy Pelosi, Senate Minority Leader Chuck Schumer and other Democrats for talks on infrastructure spending at 10:30 a.m.
 

Must Reads

WeWork, which subleases office space on a short-term basis to a variety of companies, previously reported a loss last year of $1.9 billion on revenue of $1.8 billion. PHOTO: MANDEL NGAN/AGENCE FRANCE-PRESSE/GETTY IMAGES
WeWork filed for an IPO. Shared office space giant WeWork said it has filed for an initial public offering, making it the latest highly valued startup to shoot for the public markets this year. Chewy Inc., the online seller of branded and private-label pet food and grooming supplies, has also filed documents for an IPO.
Copper’s slide is signaling caution about Chinese growth. A slide in copper prices in recent days is causing investors to grow warier of a slowdown in Chinese economic growth, increasing their focus on coming trade talks. Meanwhile, a gauge of China’s factory activity weakened sharply.
A bitcoin venture backed by the NYSE owner is facing a fresh delay. A plan by the owner of the New York Stock Exchange to make it easier for consumers to pay for purchases in bitcoin faces further delays after the venture, called Bakkt, said it was applying for a license from New York state regulators.
Regulators are scrutinizing trades before the Anadarko deal announcement. Traders used insider information to turn a profit of about $2.5 million related to the sale of Anadarko Petroleum Corp., according to the Securities and Exchange Commission.
Verizon retirees are urging changes to the company’s executive pay practices. Verizon shareholders will vote at the company’s annual meeting this Thursday on a proposal that the retirees hope will persuade Verizon to stop offering executives an investment option in their company-sponsored savings plans it doesn’t offer to rank-and-file workers.
 

What We've Heard on the Street

“WeWork is building off a tech-IPO foundation...The New York-based company may be hoping to fetch a tech-like valuation in the wake of other recent initial public offerings.”
—Heard on the Street columnist Lauren Silva Laughlin
 

Stocks to Watch

Western Digital: The memory-chip maker swung to a loss in the most recent quarter, weighed down by an inventory write-down.
MGM Resorts International: The company's first-quarter profit fell short of Wall Street expectations. 
Sanmina: The electronic manufacturer’s earnings and sales in the latest period came in above analysts' projections.
Texas Roadhouse: Higher labor costs pressured the restaurant chain's first-quarter profit. 
   

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