Monday, February 25, 2013

China’s manufacturing is expanding at the slowest pace

China’s manufacturing is expanding at the slowest pace in four months. HSBC Holdings Plc and Markit Economics today said that the preliminary reading of a Purchasing Managers’ Index was at 50.4 in February. That compares with the 52.3 final reading for January and the 52.2 median estimate of 11 analysts surveyed by Bloomberg News. A number above 50 indicates expansion.

Today’s report may damp optimism that an economic rebound is gaining traction following a seven-quarter slowdown and the weakest annual expansion in 13 years. The benchmark Shanghai Composite Index (SHCOMP) last week dropped the most since May 2011 on concern the government will expand restrictions on the property market to curb home-price gains.

Saturday, February 16, 2013

Consumer confidence at 3-month high

Consumer confidence at 3-month high

Consumer confidence at 3-month high at 76.3.

The gauge, provided by the Thomson Reuters/University of Michigan preliminary index, climbed from 73.8 in January. Increasing confidence may help preserve recent gains in household spending and propel the economy. Increased property values, a strengthening job market and stocks at five-year highs are boosting Americans' balance sheets and offsetting an increase in payroll tax.

Saturday, February 9, 2013

Dell Buyout

Shareholders are being pushed aside in the proposed Dell buyout. Michael Dell will benefit with this buyout, his $3.7 billion stake could more than triple in five years. But the company's biggest outside investor Southeastern Asset Management, opposes the deal. They said that it "grossly undervalues the company."

Southeastern believes the price is much too low and will vote against the proposed deal. Southeastern values the company at $23.72 a share, greater than the $13.50 to $13.75 a share that Dell and his partners are offering.

“We would have endorsed a transformative transaction that would have provided full and fair value to Dell’s public shareholders, including a leveraged recapitalization or a go-private type sale where current shareholders could elect to continue to participate in a new company with a public stub,” Southeastern said.

“Unfortunately, the proposed Silver Lake transaction falls significantly short of that, and instead appears to be an effort to acquire Dell at a substantial discount to intrinsic value at the expense of public shareholders.”

"This deal is so compellingly unfair to shareholders that I don't know where to begin," says Richard Pzena, chief investment officer at Pzena Investment Management, which held 14 million shares on Sept. 30. His firm values Dell at about $25 a share. The stock was unchanged at $13.63 last week, after gaining about 1% Friday afternoon on the Southeastern news.