Bausch Prices IPO at Low End Of Target
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Bausch + Lomb Corp. priced its IPO at $18 a share Thursday, falling short of expectations as it became the first big company in months to try going public into a turbulent stock market Bausch Health Cos., the parent company, raised $630 million in the offering. It had been aiming to raise as much as $840 million and sell the stock at $21 to $24 a share, according to a regulatory filing. The Wall Street Journal had previously reported the deal was likely to price at the low end or below the range The debut of the eye-care company, a spinoff of Bausch Health Cos., is being watched closely as a bellwether for the IPO market, which has been virtually shut down since stocks started falling earlier this year. It is the first big initial public offering since private-equity firm TPG Inc. went public in mid-January. After a record year in 2021, traditional IPOs have raised less than $3.3 billion in 2022, the slowest start since 2016, according to Dealogic. Bausch is a fitting test case for the IPO market, which provides a crucial spigot of cash and visibility to startups and Wall Street alike. The company is profitable and a well-established name in its industry.
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The Swiss stock market significantly extended the losses of the past two sessions on Friday. The SMI lost 1.2 per cent to 11,730 points. Among the 20 SMI stocks, there were 17 price losers and three price gainers. 38.78 (previously: 40.72) million shares were traded. Swiss Re led the table with a gain of 0.5 per cent. On the previous day, investors had been hard on the reinsurer's business figures, but now the share price recovered somewhat. Once again, Richemont (-2.6%) and, outside the SMI, Swatch (-1.1%) were among the weaker stocks. The watchmaker's shares again suffered from the gloomy economic outlook in the important sales market of China. Among banking stocks, Credit Suisse (-1%) and UBS (-0.2%) led the way for ING. The share price of the Dutch bank lost 4.7 per cent after the presentation of business figures - net profit in the first quarter had halved. Novartis (-0.7%) was on the receiving end of bad news as the pharmaceutical group suspended production of two oncology drugs at sites in Italy and New Jersey (USA) due to possible quality problems in the manufacturing process.
European stock markets ended lower on Friday, despite the announcement of better than expected job creation in the United States in April. The Stoxx Europe 600 index lost 1.9% to 429.9 points. In Paris, the CAC 40 and the SBF 120 each lost 1.7%. In Frankfurt, the DAX 40 gave up 1.6%, while in London the FTSE 100 lost 1.5%. International Consolidated Airlines Group SA reported Friday a narrowed operating loss for the first quarter that missed consensus guidance, but said it expects its operating result to be profitable from the second quarter onward. The company—which houses British Airways, Iberia, and Vueling among others—said its operating loss was 731 million euros ($770.6 million) compared with an operating loss of EUR1.08 billion for the first quarter of 2021. Operating loss was expected to be EUR548 million, Jarrod Castle, an analyst at UBS, said in a research note, who also quoted operating loss consensus of EUR510 million. ING Groep NV on Friday reported a more-than-halved net profit for the first quarter after booking a number of provisions, mostly related to its exposure in Russia. The Dutch bank has also announced plans to return 1.25 billion euros ($1.32 billion) to shareholders, of which EUR380 million will consist of share buybacks with the rest in dividends. The board plans to pay a dividend of 23.20 European cents on May 18.
U.S. stocks slipped Friday, extending their losses after one of Wall Street's worst selloffs since the pandemic began. The Dow Jones Industrial Average lost 90 points, or 0.3%, after slumping more than 1,000 points Thursday, its worst day since 2020. The S&P 500 shed 0.5%, while the technology-heavy Nasdaq Composite lost 1.3%. Stocks have swung wildly in recent sessions as investors have tried to gauge what impact the Federal Reserve's plan to raise interest rates will have on the economy. They are caught between competing hopes: that rate increases will be significant enough to tame rapidly rising inflation, but not so large that they will derail economic growth. The latest jobs report showed that the U.S. economy added 428,000 jobs in April and that the unemployment rate remained unchanged at 3.6%. Economists surveyed by The Wall Street Journal had projected that 400,000 jobs were created in April and that the unemployment rate fell to 3.5% – where it stood just before the pandemic and a five-decade low – from 3.6%. In corporate news, DoorDash shares lost 1.4% after the food-delivery company reported a rise in quarterly revenue late Thursday, though its rate of growth for the quarter slowed. Boeing Co. said it planned to move its global headquarters to Arlington, Va., from Chicago, a shift that would bring the aerospace giant’s leadership closer to top federal officials after a challenging period for the plane maker. The announcement, which confirmed an earlier report by The Wall Street Journal, comes as the future of many of Boeing’s jetliner and military programs lies with regulators, Pentagon officials and lawmakers following a tumultuous three years for the company.
Stock markets in East Asia and Australia start the new week with predominantly negative signs. Concerns about a recession prompted investors to pull back from equities, traders report, citing among other things the strict contact and movement restrictions in China to contain the Corona pandemic. On the Tokyo stock exchange, the Nikkei-225 falls by 2.3 per cent. Japanese investors are divesting themselves of steel and mechanical engineering stocks in particular as a result of the economic worries. Among others, Nippon Steel loses 4.9 per cent and Komatsu 5 per cent.
In U.S. bond markets, the yield on the benchmark 10-year U.S. Treasury note rose to 3.124% from 3.066% on Thursday, which marked its highest level since November 2018. Bond yields rise as prices fall.
Citi lowers the Gea target to EUR 43 (44) – Buy
UBS raises the Shell target to 2,550 (2,450) p – Buy
CS raises the Fresenius target to EUR 38 (35) – Neutral
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