Finance

Hongbaos are usually reserved for special occasions, such as birthdays, weddings and the Chinese mid-autumn festival, which got under way on September 29th. But now these red envelopes, stuffed with cash, are part of a push by China’s banks to get citizens thinking about retirement. They are being offered to customers who register for private-pension accounts.Under a law introduced last November, workers may set aside savings in tax-deferred accounts accessible upon retirement, much like America’s Individual Retirement Accounts (iras). Those who want to enrol must open an account with a bank, before allocating their deposits to a licensed wealth manager. Savers can deduct contributions from taxable income; they pay no tax on capital gains and only a 3% tax rate at the time of distribution.If these terms sound attractive, it is because officials cannot afford for the scheme to fail. Chinese workers retire young—as early as 50 for women and 60 for men. Last year the population shrank for the first time since Mao Zedong’s “Great Leap Forward” in 1962, even as the number of old folk grew. China’s compulsory basic pension, which has more than a billion enrollees and is paid for through employer contributions, will be in deficit by 2028 and run out entirely by 2035, according to modelling by an official think-tank.When the reforms were introduced, analysts estimated that they would raise the value of China’s private pensions from $300bn (which had accumulated during the pilot version of the scheme), to at least $1.7trn by 2025. Such a pot would rival the world’s largest pension funds and give officials capital to channel to favoured industries. The scheme would also give Chinese people a new avenue for saving, drawing them away from the country’s troubled property market. Unfortunately, though, things are not going entirely to plan.Banks, which are mostly state-owned, have offered customers incentives to open accounts, including discounts on phone bills, rewards for referrals and even free ibuprofen (there was a shortage at the time). Although these have lured customers, with more than 40m having signed up by June, getting them to actually save is a struggle. In March fewer than one-third of accounts contained funds. The government has since stopped releasing figures, but there is little reason to believe that savings have risen in the intervening period. Moreover, the president of one bank estimates that 70% of funds deposited go uninvested, remaining in bank accounts, perhaps because depositors want to enjoy the tax advantages without entering financial markets they perceive to be risky.What is going wrong? Some of the problems facing the pension system reflect its design. Banks, with which customers are required to open accounts, are unfazed by the low contributions. They simply want to beat their rivals on sign-ups, and some are too busy defusing bad debts to focus on pensions, notes an analyst.But there are deeper issues at play, too. Officials say that workers are unaware of the importance of pension planning. Bankers propose bigger tax breaks and a higher maximum contribution, which is currently 12,000 yuan ($1,700) a year, or 15% of the average disposable income in Shanghai. Neither group wants to confront the possibility that the problem is even more profound. Chinese stockmarkets have long struggled to attract investors, with households preferring property. Financial assets are seen as too volatile—and too vulnerable to political interference.The situation is unlikely to improve any time soon. Pension pots cannot be invested offshore, meaning that they do not offer a way to escape a weak domestic economy. Local stockmarkets are not exactly becoming any more alluring: Shanghai’s main equity index is down this year. The government is also expected to raise the retirement age, which delays when savers can gain access to their investments. Last month the pensions ministry was forced to refuse requests from working-age depositors to withdraw their funds. All this means that another worry—a failing private pension system—can be added to the long list facing Chinese policymakers. ■For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter. More

In theory, financial indices are similar to thermometers, providing objective numbers that reflect external conditions. In reality, especially if the underlying securities are bonds, human choices about their composition make an enormous difference—as India is now demonstrating.On September 21st JPMorgan Chase, a bank, decided to include Indian government bonds in its emerging-markets index. The decision was hailed by Indian ministers, and Jamie Dimon, JPMorgan’s boss, as a sign of India’s rise. Then, on September 29th, ftse Russell, another indexer, announced, with much less ado, that it would not follow suit, owing to concerns about how markets function in India. Investors are awaiting a call by Bloomberg Barclays Emerging Market Bond Index.JPMorgan’s move may now prompt an influx of $24bn into India’s government-bond market as the switch is made, according to one estimate. Were Bloomberg’s managers to make a similar decision, and ftse Russell’s to be won over by reforms, the gain could rise to around $40bn. That is a sizeable figure, particularly when set against net purchases of Indian government bonds by foreigners, which amounted to just $3.8bn in the first eight months of this year. The changes in JPMorgan’s index, which will take place over a ten-month period beginning in June, could reduce India’s benchmark ten-year interest rate by as much 0.45 percentage points, or about 7%, reckon some economists.JPMorgan’s decision was prompted by support from large investors—when surveyed, 73% backed India’s inclusion in the firm’s emerging-markets index. Once the reallocation is complete, India’s share of the index will be 10%, matching those of China, Indonesia, Mexico and Malaysia. To accommodate India, there will be cuts in excess of one percentage point to Brazil, the Czech Republic, Poland, South Africa and Thailand. The result will be an increase in the relative importance of Asia.India’s inclusion is not an unalloyed good for the country, however. Outside money will strengthen the rupee, and thus depress inflation and the price of imports, benefiting consumers and some manufacturers. But it will also reduce the competitiveness of Indian exports, at a time when the government is keen to boost it, and swell the country’s large trade deficit. Foreign investors can also be skittish, leading to volatility and raising the chance of a sudden stop to capital inflows.Investors also face pitfalls. Bringing money into and out of India is, at best, messy. Foreign-ownership registration and reporting requirements are unhelpfully complex. There are taxes on transactions and gains, and then extra hurdles for those wishing to take their gains outside of India. These add costs, undermine returns and in the past have pushed away all but the most determined investors.Large local brokers and international banks are thrilled by JPMorgan’s decision, in part because it means lots of money will be arriving into the financial system, which they can help (for a fee) circumvent such impediments. Other firms are likely to try to create derivative products that capture the swings of Indian bonds without the accompanying burdens, which will annoy the Indian government.The happiest outcome would be for India to use the transition to do away with some of the regulation facing its securities markets, making the country more welcoming to foreign investment. The government now has an added incentive to be responsible in other areas, too. After all, smaller fiscal deficits would mean less vulnerability to capital flight. If such changes were made, the short-term relief of lower costs of capital would be joined by a more profound transition to greater financial stability. A lot can ride on the decisions made by anonymous index compilers. ■For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter. More

For america’s commerce secretary, midway through a trip to Beijing, to describe China as “uninvestible” might once have prompted an unpleasant diplomatic spat. Yet when Gina Raimondo did so a month ago, it barely caused a ripple. That was not just because the rest of her visit was a clear attempt at rapprochement. It was also because it is now firmly established that American companies, as well as Western investors more generally, see China in such terms.The bad news just keeps coming. Sometimes it is Chinese authorities raiding the offices of American companies and detaining their staff, as they did to Mintz Group, a due-diligence firm, earlier this year. At other times it is Chinese bosses disappearing, as has happened on numerous occasions in recent years. In September it emerged that an investment banker at Nomura had been barred from leaving the country. All of this is happening in the context of a profound economic malaise. On October 1st the World Bank became the latest institution to downgrade its gdp forecasts for China. And disturbing the sleep of investors is an even bleaker prospect: a Chinese invasion of Taiwan. Should Xi Jinping decide to launch such a war, the resulting sanctions would cause economic and financial chaos, stranding capital ploughed into Chinese assets.It is tempting, then, for Western investors to look at these risks and conclude that China is just too troublesome to think about, which is exactly what many are doing. On the face of it, avoiding China should be a reasonably straightforward task. After all, the world’s second-biggest economy does not have a particularly large presence in equity indices. Take, for example, msci’s broadest index of global stocks, ranked according to market value. American shares occupy a weight of 63%. By contrast, Chinese ones manage barely a thirtieth of that, at just 3%.Yet there is a snag. Investors might easily be able to screen out Chinese stocks. They cannot so easily escape the pull of the world’s second superpower. Therefore even those who cut their exposure to China will have little choice but to keep tabs on the country’s fortunes.To understand why, begin with China’s role in Western supply chains. Prompted both by covid-era trade snarl-ups and by increasing geopolitical concerns, companies are doing their best to diversify. It is proving heavy going, however. In 2022 Apple produced the majority of its products in China. By 2025, despite concerted efforts to find new countries in which to manufacture, that will still be true.Less visible, though no less important, is the share of Western firms’ cash flows that come directly from China. Analysts at Morgan Stanley, an investment bank, have studied the revenues of 1,077 North American companies to determine their exposure to foreign markets. Those in the information-technology sector, which comprises more than a quarter of the s&p 500 index, earn 12% of their revenues from China. For semiconductor firms—such as Nvidia, this year’s star performer—the figure is even higher, at 28%. Western sanctions resulting from an invasion of Taiwan might leave investments in Chinese assets stranded. But reciprocal sanctions from China could hobble some American firms, too.A final line of exposure comes from China’s gargantuan demand for commodities. Analysts at Goldman Sachs, another investment bank, reckon that China accounts for 16% of global demand for oil, 17% for liquefied natural gas, 51% for copper, 55% for steel, 58% for coal and 60% for aluminium. The immediate consequence is that prices for commodities, and the shares of any firm that buys or sells a lot of them, depend heavily on Chinese economic growth, or a lack of it. Given commodities’ impact on broader prices, this also means that if your portfolio is exposed to inflation—or to the swings in interest rates that accompany it—then it is exposed to China.One way to read all this is as a counsel of despair. The risks of staking money on China’s growth and stability are both palpable and large. It is pretty much impossible to construct a portfolio that will benefit from global growth, which also lacks exposure to China, since anything to do with technology, commodity prices, inflation, interest rates or any country dependent on the world’s second-biggest economy brings with it some risk. The other reading is the same as the time-worn case for buying American assets. It is not that they offer guaranteed returns. It is that if they face disaster, so too will everything else.■Read more from Buttonwood, our columnist on financial markets: Investors’ enthusiasm for Japanese stocks has gone overboard (Sep 28th)How to avoid a common investment mistake (Sep 21)Why diamonds are losing their allure (Sep 13th)Also: How the Buttonwood column got its name More

Shares of Britain’s Metro Bank suspended trading Thursday after tanking more than 29%.
It comes amid reports that it was trying to raise £600 million ($727 million) in debt and equity.
The London Stock Exchange, which lists the stock, confirmed to CNBC that the brief suspensions were triggered by its circuit breaker mechanisms.

A close-up of a sign of Britain’s Metro Bank.
Matthew Horwood | Getty Images

LONDON — Shares of Britain’s Metro Bank were briefly suspended from trading twice early Thursday, in a volatile session that saw the stock shed more than 29% from the Wednesday close.
They have since slightly pared losses, having resumed again trading shortly after 9:00 a.m. London time.

The London Stock Exchange, which lists the stock, confirmed to CNBC that the brief suspensions were triggered by its circuit breaker mechanisms because of the extent of the volatile drop.
The halts followed reports that the bank was trying to raise £600 million ($727 million) in debt and equity, according to Reuters. The challenger bank, which launched in 2010, has a market cap of less than £100 million.
Metro Bank said in a statement that it is currently considering “how best to enhance its capital resources,” with a particular focus on a £350 million bond due to mature in October 2025.
Investors traded more than 1.6 million shares immediately after the stock market opened Thursday, according to FactSet. Typically, less than 100,000 Metro Bank shares change hands every hour.
Shares of the bank have lost around two thirds of their value since the middle of February. Metro Bank was valued at £87 million as of the Wednesday close, according to Reuters.

Last mont, the Bank of England’s main regulator, the Prudential Regulation Authority, suggested that it was unlikely to allow the lender to use its own internal risk models for some mortgages.
As such, the Metro Bank would be subject to higher capital requirements — a concern that has weighed on investors.
“It has been clear for some time that [Metro] is short of capital, with the bank operating below MREL requirements,” investment bank Keefe, Bruyette & Woods said in a research note, referring to minimum requirement for own funds and eligible liabilities enforced by authorities.
The key questions now facing the bank center on its ability to raise that capital and whether that will be sufficient to remove capital concerns, the note said.
— CNBC’s Ganesh Rao contributed to this report. More

Whether it’s China, India or Japan, the region’s edge today lies in industrial services, KKR’s heads of global and Asia macro said in an October note.
That investment conclusion comes after a trip to the region by New York-based Henry H. McVey, who is also chief investment officer of KKR Balance Sheet.
“I think there are two big megathemes in Japan,” KKR’s McVey told CNBC on Thursday. “One is this automation and industrialization, there’s a true capex cycle that’s going on in Japan that we haven’t seen in some time.”

Pictured here are self-driving robots in a China Duty Free Group’s warehouse in Haikou, Hainan, on March 20, 2023.
Vcg | Visual China Group | Getty Images

BEIJING — Asia’s competitive advantage was once cheap labor. Now, whether it’s China, India or Japan, the region’s edge lies in industrial services, KKR’s heads of global and Asia macro said in an October note.
That includes logistics, waste management and data centers, the private equity giant said. “We think that there is both internal demand and an external component to this story.”

That investment conclusion comes after a recent trip to Singapore, China and Japan by New York-based Henry H. McVey, chief investment officer of KKR Balance Sheet. He is also KKR’s head of global macro and asset allocation. Singapore-based Frances Lim, managing director and head of Asia macro and asset allocation, also made the trip.
“The bid for infrastructure and logistics could accelerate even more meaningfully, we believe, in key markets such as India, China, Indonesia, the Philippines, Vietnam and even Japan,” the KKR report said.
About 20% of KKR’s balance sheet is allocated to Asia, a region that’s undergoing a longer-term shift requiring more fixed investment, the report said.
While the firm doesn’t break out allocations by country, some of its biggest announced deals in the last two years have been in Japan. That includes a $2 billion acquisition of a Mitsubishi-backed real estate manager in spring 2022.

“I think there are two big megathemes in Japan,” KKR’s McVey said in an interview Thursday. “One is this automation and industrialization, there’s a true capex cycle that’s going on in Japan that we haven’t seen in some time.”

He pointed to Japanese Prime Minister Fumio Kishida’s speech in New York last month, which noted domestic investment is set to break records with more than 100 trillion yen ($673.58 billion) this year.
“If that creates productivity, it’s going to allow them to drive wage increases which is something we haven’t had for some time,” McVey said. He expects Japan is exiting deflation.
The other big trend in Japan, McVey said, is corporate reform that’s boosting shareholder returns.
After decades of sluggish growth, Japan has become a hot spot for international investors this year, against a backdrop of uncertainty about China. In April, U.S. billionaire Warren Buffett visited Japan to announce additional investments into major Japanese companies.

KKR in March said it completed its acquisition of Hitachi Transport System, a logistics company primarily for supply chains, now renamed Logisteed. KKR this year also said it made its first hotel investment in Japan by acquiring Hyatt Regency Tokyo, as part of a deal with Gaw Capital Partners.
“Japan remains a ‘must own’ country, we believe,” the KKR note said, adding that “Japan is a great story that is not trading at a full price.”
As one of the world’s largest private equity firms, KKR said it had $519 billion in assets under management as of June 30.

India

While McVey and Lim didn’t visit India on their latest trip, they said in their co-authored report their time with corporate executives confirmed a positive investment case.
Public capital expenditure in India has grown 200% over four years, while the country’s exports are surging, the report pointed out.
“There’s really finally some investment in infrastructure and that’s leading to, one, greater productivity, but two, it’s helping on the inflation front and it’s helping on the economic growth,” McVey said. He noted that in emerging markets, opportunities to benefit from rising GDP per capita trends are often more accessible in private rather than capital markets.

On Wednesday, KKR announced it opened a new office, in Gurugram, where it has appointed Nisha Awasthi, formerly of BlackRock, as managing director and anticipates 150 new employees by early 2024.
That expansion to northern India adds to an existing office in Mumbai. KKR’s other Asia-Pacific offices are in Beijing, Hong Kong, Seoul, Shanghai, Singapore, Sydney and Tokyo.

China

While McVey said his last trip to India was in 2019, he and Lim wrote their October note following their third trip to China this year.
“Overall, growth in the country appears to be bottoming,” they said, noting the firm maintains a 4.5% real GDP growth forecast for China next year, along with 1.9% inflation.
In July, KKR said it had about $6 billion invested in China.
One of McVey’s big takeaways from his latest trip to China was a better understanding of how the economy is changing, amid the drag from the contracting real estate sector.
“There’s a transition going on that may be not fully appreciated,” he said. He pointed out that China’s digital economy and push for decarbonization may only represent 20% of the country’s GDP today, but they are growing by nearly 40% a year.

He has visited Asia regularly since 1995, and spent more than three decades in the finance industry.
The biggest changes during that time is not only global integration and greater monetary policy intervention, but heightened global competition, he said. “Everywhere I go there’s some political agenda that we need to be considerate of. I don’t think it stops us from investing.”
Opportunities in future trends such as automation, however, take time to play out.
“It’s an evolution, not a revolution,” McVey said of the situation in Japan, where his team’s research has found a one-time labor surplus is now gone. More

It is A brave investor who calls the end of a four-decade trend. But bond yields have risen so far and—in recent weeks—so fast that many market participants now believe the era of low interest rates to be over. Since early August America’s ten-year Treasury yield has traded in excess of 4%, a level unseen from 2008 to 2021. On October 3rd it hit a 16-year high of 4.8%, having risen by half a percentage point in a fortnight. The moves have spilled over globally: to Europe, where they threaten to bring about a fiscal crisis in indebted Italy, and Japan, which is clinging on to rock-bottom interest rates by its fingertips (see chart 1).image: The EconomistWhat is going on? Start in America, with some financial mechanics. Investors who hold Treasuries typically have the option of lending in money markets, in which overnight interest rates are set by the Federal Reserve. The yield on the shortest-maturity Treasuries therefore tracks Fed policy. At longer maturities yields reflect two extra factors. One is expectations of how the Fed will change rates in future. The other is the “term premium”, which compensates investors for the chance of nasty surprises: that forecasts for interest rates or inflation turn out to be wrong—or even, in theory, that the government defaults.Both policy expectations and the term premium have driven up yields. After America’s banking turmoil in the spring, investors feared recession and expected the Fed to cut interest rates this year. Then the turmoil ended, fears faded and forecasts for economic growth rose. Markets came around to the view espoused by the Fed itself: that it will hold rates higher for longer. At the same time, many policymakers and investors nudged up estimates for where rates will settle in the long term. Investors were not pencilling in more inflation, expectations for which have been fairly stable. Instead, expected real interest rates soared (see chart 2).image: The EconomistIn recent weeks things have changed. The New York Fed publishes a daily estimate of the term premium on the ten-year Treasury yield, derived from a financial model. Since August it has risen by 0.7 percentage points, enough to fully explain the rise in bond yields over that time.Some attribute the surge in the term premium to simple supply and demand. The Treasury has been on a borrowing binge. From January to September alone it raised a whopping $1.7trn (7.5% of GDP) from markets, up by almost 80% on the same period in 2022, in part because tax revenues have fallen. At the same time, the Fed has been shrinking its portfolio of long-dated Treasuries, and some analysts think China’s central bank is doing the same. Traders talk of price-insensitive buyers leaving the market, and of those who remain being more attuned to risk.Others point to fundamentals. Outside America, the global economy looks wobbly. In downturns, investors’ appetite for risk falls. The oil price has risen, America’s government could yet shut down and the House of Representatives is in turmoil. The uncertain effects of all this pushes up the term premium. As well as affecting the supply of new Treasuries, America’s gaping fiscal deficit is a long-term phenomenon. A rule of thumb from one literature review suggests it is large enough to be forcing up the interest rate the Fed must set to stabilise inflation by nearly three percentage points.In fact, the trajectory of America’s public finances is so dire that the most bearish investors talk of the long-term risk of “fiscal dominance”; that interest rates might eventually be set with the goal of controlling the government’s debt-service costs, rather than inflation. Although markets have not priced in much more long-run inflation yet, measures of inflation risk—which affects the term premium—have rebounded since falling earlier this year.Regardless of their cause, movements in America’s bond markets set the pace elsewhere. Higher rates in America tend to push up the dollar, encouraging other central banks to tighten in order to avoid suffering inflation from pricier imports. And term premia are correlated globally, owing to the mobility of capital.Reflecting these spillovers, rates in the euro zone have risen in recent weeks, too, even though the economic picture is different. Surveys indicate the bloc is already in recession. Across the zone, fiscal deficits are smaller and the European Commission is debating how to cut state spending.But dealing in aggregates does not make sense when each country runs its own budget. Rising rates have brought back worries about the sustainability of public finances in the euro zone’s most indebted big economy. Italy’s ten-year bond yield is now 4.9%, its highest since 2012, when the euro-zone’s debt crisis was raging. It is more than its budget can bear for long without fast economic growth or austerity. The spread over German ten-year debt is now just below two percentage points. Investors in Italian debt do fear that they might not get their money back—or that one day they may be repaid in lira. Look to Japan, though, for the most dramatic immediate consequences of rising yields. The Bank of Japan has been an outlier, keeping interest rates at -0.1%, even as inflation has risen. It also continues to cap ten-year bond yields at 1%, a ceiling it lifted from 0.5% in July. On September 29th it announced an unscheduled purchase of ¥301bn ($2bn) of bonds in defence of the cap, as bond yields neared 0.8%. On October 4th it returned to the market with a buy of ¥1.9trn. Rumours swirled that the authorities may have intervened to support the yen on October 3rd after the yen briefly reached 150 to the dollar only to snap back suddenly to 147. That would be in line with past practice. Last October the authorities tried to defend the currency for the first time in 24 years after it crossed the 150 mark. If the long era of low rates really is over, many other financial rubicons could be crossed in the months to come. ■ More

The Fluor Corporation logo is displayed on a smartphone.
Sopa Images | Lightrocket | Getty Images

Check out the companies making headlines in midday trading.
Fluor Corporation — The engineering and construction company gained 2.4% after UBS upgraded Fluor shares to buy. The Wall Street firm is bullish on Fluor after reaching agreements to complete new projects.

Carnival — Cruise line stocks rose as a group during midday trading. Carnival and Norwegian Cruise Line added 2.8% and 3.9%, respectively. Royal Caribbean shares gained nearly 3%. Those moves followed a steep decline in oil prices.
Sunnova Energy, Sunrun — Sunnova Energy added 2.2%, while Sunrun declined 1.1% after Truist downgraded the solar stocks to hold from buy ratings, citing near-term concerns from elevated interest rates.
Cal-Maine Foods — Shares slipped 7.3% after the egg producer provided a weak earnings report, citing a dynamic market environment. The company reported fiscal first-quarter earnings of 2 cents per share, missing the consensus estimate of 33 cents per share from analysts polled by FactSet.
Intel — The chipmaker rose slightly by 0.7% after Intel said its programmable chip unit will be a stand-alone business, with an initial public offering planned within the next two to three years.
DexCom, Insulet — Diabetes names DexCom and Insulet fell 3.5% and 3%, respectively, after a study released Tuesday suggested a class of popular weight loss drugs GLP-1 could affect the need for basal insulin. Separately, Insulet said on Tuesday that Wayde McMillan would step down as chief financial officer.

Energy stocks — Energy stocks fell as a group during midday trading Wednesday as oil prices slid more than $3 a barrel. Marathon Petroleum shares were down 3.7%, while Phillips 66 shares dropped 4.5%.
— CNBC’s Alex Harring and Samantha Subin contributed reporting. More

Signage outside Intel headquarters in Santa Clara, California, Jan. 30, 2023.
David Paul Morris | Bloomberg | Getty Images

Check out the companies making headlines before the bell.
Intel — Shares popped 2.5% after the chipmaker announced it would be operating its programmable chip unit as a standalone business complete. Intel plans to conduct an initial public offering for the unit within the next two to three years.

Fluor —  Shares climbed 2.4% following an upgrade to buy at UBS. The firm is bullish on the stock thanks to progress on legacy projects and said Fluor is on the brink of a company turning point. 
Apple — The iPhone maker shed 0.9% after KeyBanc cut its rating on Apple to sector weight from overweight late Tuesday, citing shares’ high valuation and an expectation for soft growth in the United States.
Sunrun, Sunnova Energy International — Shares of Sunrun and Sunnova dropped 3% and 2.8%, respectively, after Truist Securities downgraded the solar panel installers to hold from buy on Wednesday. The firm said higher-for-longer interest rates could hit solar energy stocks.
Moderna — The pharma stock rose slightly after Moderna announced positive interim results from the Phase 1/2 trial of mRNA-1083, an investigational combination vaccine against influenza and Covid. Moderna said in a press release it plans to begin a Phase 3 trial of the combination vaccine in 2023, working to accomplish potential regulatory approval in 2025.
Oddity — The Israel-based beauty stock, which owns direct-to-consumer brands Il Makiage and SpoiledChild, added 3.2% after Bank of America upgraded it to buy from neutral. The bank said it expects sustainable annual sales growth and margin expansion.

Novartis — Shares lost 3.7% after the Swiss drugmaker completed the spinoff of its generics and biosimilars business Sandoz, which dipped on its market debut on the SIX Swiss Exchange.
Cal-Maine Foods — The stock plunged 11.6% after the company came out with disappointing sales figures due to lower prices. The egg producer reported fiscal first-quarter earnings of two cents per share, while analysts polled by StreetAccount had called for earnings of 33 cents per share. Revenue was also lackluster.
— CNBC’s Brian Evans and Lisa Han contributed reporting. More