Kamis, 09 Januari 2020

America has turned its back on big department stores - CNN

This trend isn't new. It has been going on for several years (remember Sears?). But the 2019 holiday shopping season brought their troubles into stark relief.
Despite low unemployment and high consumer confidence, JCPenney (JCP) had a dismal holiday. Kohl's (KSS) and Macy's (M) suffered, too. And Victoria's Secret parent L Brands (LB) continued its years-long run of losses.
JCPenney's sales at stores and websites open for a year fell 7.5% during the holidays compared with last year. Kohl's and Macy's sales dropped slightly, and Macy's said it will close 28 stores. Victoria's Secret sales at stores and websites open for at least a year fell 12% and its parent cut its earnings forecast.
More than 9,300 stores closed in 2019
JCPenney's results raise "continued questions about the chain's long-term viability," Neil Saunders, analyst at GlobalData Retail, said in a note to clients Thursday. "Once loyal customers now avoid the chain and shop elsewhere."
Americans are still shopping, and consumer spending in the United States remains strong. But shoppers they are hunting for bargains at big box chains such as Walmart (WMT), Target (TGT), Costco (COST) and online. Costco said Wednesday that sales in the United States during December jumped 9.4%. These companies are taking market share from department stores, according to analysts.
There is no shortage of competitors to blame for department stores' woes. The big box chains have been able to use their scale to muscle down prices on everything from televisions to clothing. Discount retailers, including TJMaxx and fast-fashion chains, continue to grow sales.
That has suqeezed department stores, forcing them to lower prices on clothes or put them on sale, which has pressured profits.
Forget fashion and beauty. These are the grocery store influencers
Macy's, JCPenney and Victoria's Secret are also located in older malls, while Target and TJMaxx's stores are typically standalone, independent of malls. This is a major advantage to draw in customers, according to analysts.
But department store leaders have also their own strategies to blame. Department stores are making changes to stores to boost the customer experience. But they are taking incremental steps, rather than implementing sweeping overhauls.
At Kohl's, the "single biggest initiative" of 2019, according to CEO Michelle Gass, was a partnership with Amazon to accept returns for free. Kohl's hoped that the partnership would draw customer traffic, but some analysts are starting to question whether Amazon has delivered.
"We continue to be surprised that Kohl's isn't seeing much in the way of a traffic bump from its partnership with Amazon," Chuck Grom, analyst at Gordon Haskett Research Advisors, said in a note to clients Thursday.

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2020-01-09 15:19:00Z
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Lebanon slaps travel ban on Carlos Ghosn - CNN

Lebanese prosecutor Ghassan Oueidat confirmed Thursday that a travel ban had been issued that will prevent the ex-Nissan boss from leaving the country.
Lebanon said on January 2 that it had received a "red notice" from international police organization Interpol confirming that Ghosn was wanted by police in Japan.
A red notice does not compel law enforcement authorities to arrest fugitives. Lebanon and Japan do not have an extradition treaty, and Lebanese officials have said Ghosn entered the country legally.
The former auto industry titan was awaiting trial in Tokyo for alleged financial wrongdoing before he pulled off a stunning breakout from the country late last year.
Ghosn, who is a citizen of Lebanon, Brazil and France, held a press conference Wednesday in Beirut where he proclaimed his innocence and pledged to fight back against what he described as "political persecution."
"Obviously I don't consider myself a prisoner in Lebanon," he told reporters. "I'm happy to be here. I'm with my friends, my family. I don't feel at all unhappy. I'm ready to stay a long time in Lebanon."
On Tuesday, Japanese prosecutors issued an arrest warrant for his wife, Carole Ghosn, accusing her of giving false testimony during a court hearing last April. She is also in Lebanon.
Representatives for Ghosn did not immediately respond to a request for comment on Thursday.
Fugitive ex-Nissan boss Carlos Ghosn blasts Japanese justice. It was escape or 'die in Japan'

Japan's justice system

Ghosn was first arrested in Tokyo more than a year ago. Among other charges, prosecutors alleged that he understated his income for years and funneled $5 million of Nissan's money to a car dealership he controlled.
On Wednesday, he slammed Japan's criminal justice system, which he said "violates the most basic principles of humanity."
He pointed to his time in solitary confinement, extended questioning without lawyers present, and the lack of a speedy trial. Japanese prosecutors were intent on extracting incriminating information, not on determining the truth, he claimed, adding that he was allowed to shower only twice a week.
Ghosn said his arrest was part of a plot to oust him from the automotive empire he built between Nissan (NSANF), Renault (RNLSY) and Mitsubishi Motors. He did not provide evidence of this.
Carlos Ghosn: Reports of my escape are inaccurate

Prosecutors blame Ghosn

Tokyo prosecutors said in a statement following the press conference that Ghosn "has only himself to blame for being arrested and detained," and for the conditions of his bail.
There was sufficient evidence, they said, to "determine that there was a high probability of obtaining conviction."
Japanese Justice Minister Masako Mori said in a statement that Ghosn "has been propagating both within Japan and internationally false information on Japan's legal system and its practice."
"That is absolutely intolerable," she said.
— Sherisse Pham, Julia Horowitz and Charles Riley contributed to this report.

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2020-01-09 14:10:00Z
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Victoria Secret's parent stock falls on weak holiday sales and trimmed forecast - CNBC

Pedestrians walk past a Victoria's Secret store, a subsidiary of L Brands, in New York.

Craig Warga | Bloomberg | Getty Images

Victoria's Secret parent company L Brands said its holiday sales shrunk, leading the retailer to cut its earnings outlook for the fourth quarter.

The news comes on the heels of L Brands promising investors in September that an "evolution" was ahead for the embattled lingerie brand. But there weren't many bright spots in its reports on Thursday.

To stem sales declines, L Brands has promised to use a more diverse group of models in its Victoria's Secret marketing and advertising — that will reflect women of all shapes and sizes. It has vowed to make more trend-right and comfortable products, to try to win back the customers who have fled its stores for the likes of ThirdLove and Adore Me. But that didn't come in time for the holidays.

Shares of the company fell more than 4% in premarket trading.

L Brands now expects to report fourth-quarter earnings of $1.85 per share, down from its previous forecast of $2.00 per share.

During the nine weeks that ended Jan. 4, L Brands saw net sales of $3.9 billion, down from $4.1 billion a year ago. Same-store sales declined by 3%.

Victoria's Secret's same-store sales across its stores and direct channels shrank by 12% during the holiday season, a much steeper drop than the previous year's decline of 4%.

Its Bath & Body Works division reported same-store sales growth of 9%. Sales of scented candles and lotions have been propping up L Brands' otherwise increasingly outdated bra and underwear business. But some analysts have said even Bath & Body Works' best days are over.

"Bath & Body Works' top line has been great but margins are beginning to erode and compares are daunting," Jefferies analyst Randy Konik said in a note to clients earlier this month.

"Candle penetration is maxing out," he added. "Over time, BBW.com likely will have to offer more 'free shipping' offers and its products are heavy, which adds to shipping expense. ... These factors will cause margins to erode further in the segment."

L Brands shares, as of Wednesday's market close, are down about 35% over the past 12 months. The retailer has a market cap of $5 billion.

Read the full press release here.

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2020-01-09 12:52:00Z
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Why a ‘battle-weary’ Tesla enthusiast is now telling investors to move to the sidelines - MarketWatch

Now that U.S.-Iran tensions have cooled a bit, it may be time to revisit predictions from some strategists last year that said equities are primed for big gains in the first quarter.

They may have been onto something. The Nasdaq Composite COMP, +0.67%  nailed a record close on Wednesday, while the S&P 500 SPX, +0.49%  could be headed for one today, judging by positive futures action. News that China’s Vice Premier Liu He will sign a “Phase 1” trade deal in Washington next week is also inspiring investors.

Also shooting to a new high on Wednesday were shares of electric-car maker Tesla TSLA, +4.92%, whose market capitalization is now bigger than Ford Motor’s at its peak.

That brings us to our call of the day from Baird analysts Ben Kallo and David Katter, who have downgraded Tesla to a neutral rating after a longtime overweight, or bullish position, on the shares. In a note to clients, they said it is time to cash in on some of the big gains the automobile maker has seen.

“We are moving to the sidelines, admittedly battle-weary after a hard-fought several years, including [approximately] 20% outperformance over the last year,” said the team, who spoke of “contentious arguments with (evidently) high-conviction bears.”

Note the analysts lifted their share target to $525 from $355—shares closed just shy of $500 on Wednesday.

They said risk/reward for Tesla shares is looking more balanced following recent gains—up 113% in the last 6 months, nearly 18% year-to-date. And while some analysts have been turning increasingly optimistic on the company’s future, they think that process may be in the latter stages.

Baird analysts added that Tesla stock is now reflecting lots of progress the company has made over the past two years, both operationally and financially. They mentioned such pluses as the new Shanghai factory and an “extremely compelling product line,” including the Model Y, the Tesla Semi Roadster and the Pickup.

But they stopped short of suggesting investors bet on shares to fall over the long run. They said even amid bearish arguments by some, “the company has continued to grow and execute (albeit on a slower timeline than projected, at times) and we expect this will continue.”

The market

Dow YM00, +0.32%, S&P ES00, +0.29%  and Nasdaq -100 NQ00, +0.45%  futures are higher, with European stocks SXXP, +0.34% on track for a record session after Wednesday’s upbeat day on Wall Street. Asian markets ADOW, +1.58% also rebounded. Gold GC00, -0.54%  is pulling back from what’s been a big run this week.

The tweet
The chart

Investors putting money into Apple AAPL, +1.61%  shares a year ago would have doubled their money, according to this chart tweeted by Byron Lotter, portfolio manager at Vestact Asset Management.

Lotter said while some attribute the share rise to renewed popularity for Apple products in China, he thinks its services division is a star player. He cited a company statistic that shows $1.42 billion was spent on the App store between Christmas and New Year’s Eve, while he’s also positive on Apple Music and Apple TV. An “incredible business…still has legs,” he told clients in a note.

The buzz

Bed Bath & Beyond shares BBBY, -1.13%  are tumbling after the housewares retailer reported a big quarterly miss and pulled its outlook.

Watch shares of HP HPQ, +1.31%  after the printer and personal computer maker again rejected a takeover bid by Xerox XRX, -0.06%.

Ahead of Friday’s nonfarm payroll data, we’ll get weekly jobless claims before the open.

Random reads

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Pilot of doomed Ukrainian airliner apparently tried to avoid crashing into homes.

Chinese scientists probing a pneumonia outbreak discover a new virus.

Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. Be sure to check the Need to Know item. The emailed version will be sent out at about 7:30 a.m. Eastern.

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2020-01-09 11:39:00Z
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Kohl's shares tank on dismal holiday sales results, lowered outlook - CNBC

Shoppers enter a Kohl's store in Peoria, Illinois.

Daniel Acker | Bloomberg | Getty Images

Kohl's said same-store sales during November and December fell 0.2% due to weakness in its core women's apparel business, leading it to lower the bar for its full-year outlook.

Based on the dismal holiday performance, Kohl's said in a press release that it is now calling for fiscal 2019 diluted earnings per share to be at the "low end" of a previously announced range of of $4.75 to $4.95. In November, when it last reported quarterly earnings, the company cut its annual profit forecast to $4.75 to $4.95 per share from $5.15 to $5.45.

The news sent Kohl's shares tumbling as much 9% in premarket trading. As of Wednesday's market close, Kohl's stock had dropped about 28% over the past 12 months. Kohl's has a market value of $7.7 billion.

"We are managing the business with discipline and we expect to deliver on our earnings guidance for the full year," CEO Michelle Gass in a statement. During the holidays, Kohl's was more pleased with its performance in active, beauty and children's divisions, as well as footwear and men's, she added.

Gass said Kohl's is "working with speed to address" the issues in its women's business

Kohl's has been expected by analysts to deliver same-store sales growth during the fourth quarter, which includes the holiday season, of 0.4%.

The announcement follows one from rival Macy's a day earlier, in which Macy's said its holiday same-store sales dropped 0.6%. The decline wasn't as bad as many had feared, sending Macy's shares higher on the news. CEO Jeff Gennette said Macy's saw "a strong trend improvement from the third quarter," igniting some optimism for the retailer's turnaround plans.

Still, on the whole, department stores are expected to have underperformed during the 2019 holiday season.

The category of retailers that includes J.C. Penney, Macy's, and Nordstrom, saw overall sales decline 1.8% from Nov. 1 through Dec. 24, according to Mastercard Spending Pulse, which tracks retail spending across all payment methods.

More shoppers are expected to have turned to retailers like Target and Walmart — which aren't at traditional malls — for apparel, electronics, and other gifts. Many rung up purchases on Amazon as well. The e-commerce giant has already claimed 2019 was a record holiday.

Kohl's has teamed up with Amazon, however, to accept returns of items purchased on Amazon at all of its stores. To try to reap any benefits, it offers discounts when people use the service. This past holiday season was the first in which the partnership was live at all of Kohl's stores nationwide. It was expected to be a boon to traffic.

Kohl's is expected to share more details regarding its holiday results when it reports quarterly earnings on March 3.

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2020-01-09 12:17:00Z
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Fugitive Ghosn brings global attention to Japanese justice - The Associated Press

TOKYO (AP) — Though former Nissan Chairman Ghosn is unlikely to stand trial in a real court, he has made himself a key witness in putting Japan’s justice system on trial.

In his first public appearance after fleeing to Lebanon, Ghosn lambasted unfair detention and bail conditions, said he was presumed guilty and had “zero chance” of a fair trial in a system rigged against him.

“I didn’t run from justice, I left Japan because I wanted justice,” the former auto industry icon said at a spirited, two-hour news conference in Beirut.

With little chance they can extradite him, Japanese authorities struck back with words Thursday.

Tokyo prosecutors, who arrested him in late 2018, said Ghosn had “only himself to blame” for being detained 130 days before being released and for the strict bail conditions like being banned from seeing his wife.

“Defendant Ghosn was deemed a high-profile risk, which is obvious from the fact that he actually fled,” they said.

Justice Minister Masako Mori denounced Ghosn’s comments as erroneous and credited Japan’s extremely low crime rate to a judicial system rooted in “its history and culture.”

Ghosn’s remarks, however, highlighted many of the issues human rights advocates call problematic in Japan’s justice system.

Because of Japan’s extremely low crime rate, how suspects are treated is surprisingly unknown to Japanese, who tend to trust authoritative figures and assume no one gets arrested without a reason.

In Japan, suspects can be detained in solitary confinement without charge for up to 23 days. Charges can be filed piecemeal to prolong incarceration. Suspects are routinely grilled for hours each day without a lawyer present. Critics call the detention conditions mental torture.

Japan’s conviction rate is higher than 99%, a number that critics, including Ghosn, say indicates unfairness.

Japanese officials insist the conviction rate is so high because they don’t make mistakes and only guilty people are prosecuted. At the same time, they insist there’s presumption of innocence.

It’s an entrenched system that not only leads to confessions but also has judges thinking suspects are guilty, says Tokyo defense lawyer Seiho Cho, who has been trying to change the system.

“They really believe that this system is functioning efficiently and correctly,” he said.

Cho said Ghosn was a high-profile case and the way regular suspects get treated is worse.

Those who insist they are innocent especially are detained longer, some for hundreds of days. Bans on contact with family members are also common, he said.

The ban in Ghosn’s case cited the risk his wife Carole may tamper with evidence. An arrest warrant was issued this week for Carole Ghosn on suspicion of perjury.

Carlos Ghosn argued the ban on contact with his wife was illogical because he was allowed to meet with other family members, implying the decision was meant to wear him out. His decision to escape was driven by his desire to be with his wife, he said.

The preparation for Ghosn’s trial had already taken a year, and the date for his trial was undecided. He was charged with underreporting of future income and breach of trust in diverting Nissan Motor Co. money for personal gain, the two separate charges complicating and prolonging his trial process.

If convicted, he could face 15 years in prison. Prosecutors also can appeal district court decisions, prolonging the process for defendants.

“Even when they are eventually exonerated, they have already lost so much,” Cho said, noting some suspects have lost their jobs, their reputation, even their families.

Among the famous cases of wrongful convictions is Iwao Hakamada, who spent 48 years in prison until new DNA evidence won his release from death row in 2014. He had been questioned, beaten and bullied by police daily in detention and confessed to murdering a family of four, but asserted his innocence when his trial began.

Frenchman Mark Karpeles was arrested in 2015 after his bitcoin exchange collapsed. He spent 11 months in detention, although he was eventually cleared of embezzlement and fraud allegations. He got a suspended sentence, meaning no additional jail time was required, on a conviction on charges of manipulating electronic data. He is appealing. Karpeles said he was an innocent victim of hackers.

A true-life story of a man who refused to sign a confession that he groped a woman on a crowded commuter train became a popular 2007 movie. The film depicts a five-year legal battle for exoneration, highlighting the burden of proof of innocence was on the accused rather than police and prosecutors proving guilt.

Although Ghosn has drawn attention to the system’s possible flaws, Cho was worried about a backlash, with release on bail getting tighter.

“We had gradually been making progress, but this could set us back,” said Cho.

For example, with the idea of introducing an electronic tether, which Japan lacks and Ghosn had proposed to get bail, fewer people could end up getting bail, and, on top of that, get electronically monitored.

Interpol has published a wanted notice for Ghosn but it is non-binding. Chief government spokesman Yoshihide Suga said whether Ghosn would be extradited was Lebanon’s decision but that Japan would cooperate with international organizations “so that Japan’s criminal justice system can be operated appropriately.”

Jacques Deguest, an expert on Japanese law and business, thinks Ghosn’s case is so embarrassing for Japan it may discourage some non-Japanese from wanting to invest or live in Japan.

“Prosecutors are regarded as guardians and protectors of Japanese culture,” said Deguest, an investor, lawyer and consultant.

Their super-efficient, but often brutal, practices have resisted change, but sometimes pressures from abroad can bring about change in Japan, Deguest said.

“Change happens often through crisis because it forces people to be uncomfortable with the status quo and forces them to move on,” he said.

“This Ghosn case is great in terms magnitude because it has the power to put the external pressure on Japan that we all love,” Deguest said.

Ghosn was careful not to blame the people of Japan for what he called the nation’s injustices.

He led Nissan for two decades, steering the automaker back from near-bankruptcy to a thriving brand, although sales and profits have tumbled since his arrest.

Ghosn said people on the streets who spotted him while he was out on bail would come up to him.

They would tell him, he said in Japanese, “Ghosn-san gambatte kudsai,” using the honorific for his name, saying: “Hang in there.”

___

Yuri Kageyama is on Twitter https://twitter.com/yurikageyama

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2020-01-09 08:06:43Z
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Bitcoin Roller-Coasters As The U.S. And Iran Send Mixed Messages [Updated] - Forbes

Bitcoin, perhaps finally finding its place as a so-called safe haven asset, has moved sharply higher after Iran retaliated for the U.S. killing of Iranian general Qassem Soleimani.

The bitcoin price, now up 15% so far this year, has added 5% to its value in the last 12-hour trading period. The jump in the bitcoin price came shortly after news of Iran’s missile attack on U.S.-led forces in Iraq early on Wednesday.

[Updated 7:10pm EST 01/09/2020] The bitcoin price has fallen back following U.S. president Donald Trump's comments downplaying the situation in Iran and suggesting "Iran appears to be standing down." Meanwhile, rockets have apparently been fired at the U.S. embassy and military facilities in Baghdad. The bitcoin price dropped to just under $8,000 per bitcoin following Trump's White House speech.

The bitcoin price, down almost half from its 2019 high, surged around $600 in a matter of minutes to almost $8,500 per bitcoin on the Luxembourg-based Bitstamp exchange before falling back slightly to trade around $8,300.

Bitcoin followed traditional safe haven assets gold and the Japanese yen higher with Iran's retaliation raising international concerns the conflict between the U.S. and Iran could continue to escalate.

Gold prices have hit their highest since March 2013.

The price of oil has also soared, with brent crude up 2.5% to around $70 per barrel on concerns there could be disruption to oil supplies from the Middle East.

U.S. president Donald Trump said via Twitter he will be making a statement on Wednesday morning, adding: "All is well! Assessment of casualties and damages taking place now. So far, so good!"

Bitcoin and cryptocurrency watchers have long speculated whether the bitcoin price could eventually perform in the same way as traditional safe haven assets, though this has so far failed to happen consistently.

"The resemblance between digital gold and the physical stuff is uncanny," Mati Greenspan, the founder of crypto and financial analysis outfit Quantum Economics, wrote in a note ahead of bitcoin's latest rise. "They've basically been moving in a very similar pattern throughout most of last year."

Last week, following the killing of general Soleimani, with Matthew Graham, chief executive of Sino Global Capital, asked if bitcoin has begun "moving in reaction to geopolitical risk."

Meanwhile, after general Soleimani was killed by U.S. forces in Iraq it was widely reported the bitcoin price in Iran had soared to around $24,000—this was, however, based on a common misunderstanding of exchange rates in Iran.

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2020-01-09 06:25:31Z
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