WEBVTT - WH Smith Cuts, HSBC Falls, BT slips 

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News, The.

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<v Speaker 2>Stock Movers Report, your roundup of companies making moves in

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<v Speaker 2>the stock market, harnessing the power of Bloomberg Data.

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<v Speaker 3>Let's take a look at some of the stocks on

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<v Speaker 3>the move today in Europe. I'm Teama Adabay with Stephen Carroll,

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<v Speaker 3>and we're joined by Bloomberg's Breaking News editor Louise Moon. Louise,

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<v Speaker 3>let's start with wh Smith. A double digit slump for shares.

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<v Speaker 3>What's happened?

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<v Speaker 1>Yeah, so eighteen percent the last time I looked in

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<v Speaker 1>terms of their share slump this morning, so it's more

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<v Speaker 1>woes essentially for wh Smith. So this morning they warned

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<v Speaker 1>on their profits for the year essentially citing a few things.

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<v Speaker 2>One main thing being.

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<v Speaker 1>The uncertainty for the Middle East what obviously that's causing

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<v Speaker 1>a lot of travel disruption and wh Smith is focused

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<v Speaker 1>now having sold off its high street business on the

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<v Speaker 1>travel sector in airports and the like, so partly on

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<v Speaker 1>that Middleast and then partly their US business being weaker

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<v Speaker 1>there citing weaker consumer demand there. They've launched a capital

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<v Speaker 1>raise to strengthen their balance sheets. That's about twenty six

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<v Speaker 1>million shares, which is about twenty percent of their existing

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<v Speaker 1>share capitals. That's to try and boost things, and obviously

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<v Speaker 1>it follows a really rough past year for w Smith.

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<v Speaker 1>So as I mentioned, they've they sold off their high

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<v Speaker 1>Tree business which to focus on travel, which is bad

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<v Speaker 1>timing given what has now ensued in the travel sector.

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<v Speaker 1>They had a probe over overstating their profits in the

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<v Speaker 1>US that continues to hang over their stock and also

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<v Speaker 1>resulted in their CEO resigning. And then now as I've mentioned,

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<v Speaker 1>this travel disruption, So a lot of woes for wh

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<v Speaker 1>Smith to battle. As I say, shares down about eighteen

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<v Speaker 1>percent this morning, they already lost as of yesterday's clothes,

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<v Speaker 1>they'd already lost about fifty percent over the past year.

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<v Speaker 1>So yeah, it's as I say that they're launching a

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<v Speaker 1>capital raise to try and strengthen things, but they've got

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<v Speaker 1>a lot to kind of battle through. And luis in

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<v Speaker 1>the banking sector or watching HSBC shares lower two percent

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<v Speaker 1>in London this morning, and this is linked to fears

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<v Speaker 1>of a regulation in China. Indeed, Yeah, so HSBC also

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<v Speaker 1>Standard Charter both lower in London as well as Hong

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<v Speaker 1>Kong both dual listed, and they're actually the worst performance

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<v Speaker 1>on the stock six hundred bank Banks index across Europe's.

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<v Speaker 1>As you say, this is linked to China. So there's

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<v Speaker 1>been a note from JP Morgan analysts saying that new

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<v Speaker 1>regulations in China will essentially make entry of new money

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<v Speaker 1>into private banking harder than was previously expected. So there's

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<v Speaker 1>It cites things like higher compliance costs, more due diligence requirements,

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<v Speaker 1>so a lot of friction for that new money to enter.

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<v Speaker 1>What it does is then create uncertainty around the wealth

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<v Speaker 1>management businesses for these banks that are exposed to China,

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<v Speaker 1>and that's something that's HPEC in particular has been pushing

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<v Speaker 1>into and that's likely that uncertainty is likely to persist,

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<v Speaker 1>could lead to slower earnings growth. And JP Morgan analysts

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<v Speaker 1>citing that particul saying that you know, they're estimating that

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<v Speaker 1>the downside risk to EPs could be about four or

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<v Speaker 1>five percent for both of those banks. So shares reacting

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<v Speaker 1>on the back of that.

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<v Speaker 3>Okay, so latest from the banking sector. But I know

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<v Speaker 3>you've also been looking at the impact of M and

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<v Speaker 3>A in the telecoms sector in UK.

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<v Speaker 1>Yeah, so yesterday afternoon there was a report for the

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<v Speaker 1>FT saying that Vodaphones three was one of a number

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<v Speaker 1>of companies that had submitted second round bids for Talk

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<v Speaker 1>Talks consumer units, so Telecom's m and a there BT

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<v Speaker 1>reacted on the back of that. So this was quite

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<v Speaker 1>late yesday afternoon, they fell as much as about eight percent,

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<v Speaker 1>and they closed yesterday three point five or so percent lower.

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<v Speaker 1>This morning, those BT shares are actually ticking higher, a

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<v Speaker 1>bit of a change in sentiments. So initially there'd been

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<v Speaker 1>worries over the risk to BT if that deal were

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<v Speaker 1>to come to fruition, worries over you know, revenue risks

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<v Speaker 1>in terms of their their broadband so most of Talk

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<v Speaker 1>Talks lines rely on open Reach, which is owned by BT,

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<v Speaker 1>so that if talk Talk or that unit of talk

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<v Speaker 1>Talk were to be bought by vote Voon three, you know,

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<v Speaker 1>would that business move elsewhere so and impact BT's revenue.

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<v Speaker 1>This morning, actually, and Liss is saying that they don't

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<v Speaker 1>actually expect if this were as I say, that there's

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<v Speaker 1>still works happen, they don't expect much initial disruption. So

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<v Speaker 1>Berenberger saying that Bloomberg Intelligence also saying that so limited

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<v Speaker 1>near term threat of Talk Talk kind of diverting revenue

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<v Speaker 1>away from BT elsewhere. So shares, as I say, slightly

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<v Speaker 1>high this morning, a bit more optimistic on that potential

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<v Speaker 1>M and A, so up about one percent after that slump, pissing.

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