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The world this week
The Economist
April 14th 2018
MarkZuckerberg attended
hearings in Congress to defend
, after the revelation
that information on 87musers
had been obtained by a politi-
cal-analytics firm linked to the
Trump campaign. Mr Zucker-
berg said he could accept
regulation of the social net-
work, provided it was under
the “right framework”, which
he suggestedmight be some-
thing akin to impending data-
protection rules in Europe. Mr
Zuckerberg’s assured perfor-
mance helped lift Facebook’s
share price by 5.7% over his two
days on the Hill.
Get ready Russia!
America’s latest round of
sanctions against
Russia
hit
hard, causing Russian stock-
markets to dive and the rouble
to plunge. Chief among the
sanctions’ targetswere seven
oligarchs and12 companies
they own or control, but in-
vestor disquiet wasmore
widely felt, spreading to Sber-
bank, Russia’s biggest bank,
among others. The list includ-
edOlegDeripaska and his
companies, such as Rusal, a
producer of aluminium. Un-
derlining the sanctions’ poten-
cy, IvanGlasenberg, the chief
executive ofGlencore, re-
signed fromRusal’s board,
which he had joined in 2007.
Stockmarkets in general had
another volatileweek, in part
because sentiment fluctuated
about the prospects of a trade
war between America and
China. Heightened geopoliti-
cal tensions over Syria pushed
oil prices
higher (some good
news at least for the Russian
economy). Brent crude
climbed above $72 a barrel, its
highest level since 2014.
Deutsche Bank
ousted John
Cryan as chief executive, three
years into his five-year con-
tract. The German lender has
suffered three consecutive
annual losses and Paul
Achleitner, the chairman, was
said to be unhappywith the
slowpace of the bank’s turn-
around. Still, several investors
complained about themanner
ofMr Cryan’s defenestration,
which couldmake for a turbu-
lent annual shareholders’
meeting next month. The new
CEO
is Christian Sewing, who
headedDeutsche’s retail bank.
A new driver
Deutsche Bankwasn’t the only
illustrious German company
shaking up itsmanagement.
Volkswagen
was reportedly
ready to replaceMatthias
Müller as chief executivewith
Herbert Diess, who heads its
core passenger-car brand. Mr
Müller got the
CEO
’s job in
September 2015, whenMartin
Winterkorn resigned in the
wake of the carmaker’s emis-
sions-cheating scandal.
The Turkish lira fell to another
lowagainst the dollar in part
because of concerns about
Turkey’s
push for growth at
any cost. Recep Tayyip Erdo-
gan, the president, unveiled an
investment package thisweek
and again called for interest
rates to remain subdued. That
spooked investors already
worried that Mr Erdogan’s
pronouncements onmonetary
policy are hampering the
central bank’s freedom to raise
rates. Inflation remains stub-
bornly high at10% and the
current-account deficit has
risen on an annual basis.
Investorswere taken by sur-
prisewhen
Saudi Arabia
sold
$11bn-worth of bondswithout
the customary roadshow. It is
thought that the kingdommay
have been trying to get a jump
on
Qatar
, which it has been
feudingwith since last June
andwhich is in the process of
drumming up support for its
own sale of government debt.
Novartis
added to its expand-
ing gene-therapy business by
agreeing to pay $8.7bn for
AveXis
, which specialises in
treatments for spinal muscular
atrophy, a genetic condition
that causes progressivemuscle
wasting.
The prancing unicorn
JackMawas reportedly prepar-
ing to raise up to $10bn in a
round of private funding for
Ant Financial
, amobile-
payments group that he
controls. MrMa created Ant in
2011 to house the Alipay
network, which he spun out
fromhis Alibaba empire. With
520musers, Alipay is the
world’s biggest mobile-pay-
ments platform, thoughmost
of its business is in China. Mr
Ma’s latest round of fund-
raising could value Ant at
$150bn, whichwouldmake it
themost valuable startup in
theworld, way ahead of the
likes ofUber andDidi Chux-
ing, two ride-hailing firms.
The European BankingAu-
thority reported that 77% of the
top earners among
European
bankers
(thosewith remuner-
ation packages of at least €1m,
or $1.1m, in 2016) were based in
Britain. That was a longway
ahead ofGermany, the next
country in the ranking, where
5% of top earners resided.
A
fat-finger
mistake by an
employee at a South Korean
brokerage led to 2.8bn shares
worth $100bn being issued to
staff in error. The employee
typed “shares” instead of
“won” when distributing
dividends in the Korean
currency. It took the brokerage
half an hour to spot the slip,
duringwhich time 16members
of staff tookadvantage of their
windfall and sold their
wrongly allocated stock.
Business
Un
i
ted Company Rusal
Source: Thomson Reuters
Share price, HK$
2016
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