An Australian inquiry on Tuesday declared Crown Resorts unsuitable to hold a gambling licence in Melbourne but allowed it to run its biggest-earning casino under supervision, raising hope for its earnings and takeover prospects.
After months of hearings in which the casino operator was accused of enabling money laundering and misleading regulators, a Royal Commission called Crown’s actions “disgraceful” in a report published on Tuesday by the Victorian state government.
The company 37%-owned by billionaire James Packer had acted in a way which was “illegal, dishonest, unethical and exploitative”, the report said. Some actions were “so callous that it is hard to imagine it could be engaged in by such a well-known corporation”.
But rather than shut down Crown’s flagship casino, the inquiry recognised the board’s reform efforts and recommended letting it continue to operate the resort for two years under supervision.
It also recommended boosting the maximum penalty for casino wrongdoing to A$100 million ($75 million), from A$1 million, and forcing Packer to cut his holding to 5% by September 2024, meaning he must sell 32% of the company by then.
A spokesman for Packer was not immediately available for comment, while Crown said in a statement that it was reviewing the report and would “work cooperatively and constructively” with the government.
The report sent a rush of relief through Crown investors who have seen takeover approaches evaporate and the company’s shares dive as they braced for full licence cancellation at Crown’s Melbourne resort, which delivers three-quarters of its profit.
Shares of Crown soared 11% in early trading before settling up 7.5% by mid-afternoon, against a flat overall market. The stock is still down 17% since early 2020 when movement restrictions to stop COVID-19 forced full or partial closures of its casinos and kept foreign tourists out of the country.
Stock of smaller rival Star Entertainment Group Ltd, which had binned a Crown buyout approach due to uncertainty about Crown’s future, also rose. Star is now under investigation over similar matters, and did not immediately respond to a request for comment.
“With a bit more regulatory certainty now, people can run the rulers and see what it’s worth again,” said John Ayoub, a portfolio manager at Wilson Asset Management, which has Crown shares.
“There are a lot of jobs and a lot of economic factors that need to be taken into consideration, and Crown is a long way down that remediation path.”
Nathan Bell, a portfolio manager at Investsmart, which owns Crown shares, said the company’s pivotal role in the Victorian economy and “the fact Crown’s key board members and CEO departed may have helped it get a second chance”.
Crown, Victoria’s biggest single-site employer with 11,500 employees at the Melbourne complex, has replaced its chairman, CEO, most of its board and senior management since its three state regulators began holding inquiries into its governance in 2020.
Packer, the company’s founder, also removed his designated nominees from the board after a separate inquiry in New South Wales found he held improper influence.
Victoria’s minister for gaming regulation, Melissa Horne, said the state government would accept all of the report’s recommendations.
“We are creating the most stringent oversight of any casino in the country. No longer will Crown’s destiny be theirs to manage,” Horne told reporters.
An independent manager would be able to investigate the Melbourne casino’s affairs and operations, attend board meetings and inspect all records, books and documents, the state government added.
The manager could direct the board and veto its decisions.
Earlier this year, the NSW inquiry led to the freezing of Crown’s licence for a new A$2.1 billion casino tower in Sydney. A third inquiry into Crown’s remaining casino, in Perth city, is ongoing.
As with the other two, the Melbourne inquiry heard detailed accounts of Crown enabling money laundering and failing to act on regulatory concerns.
($1 = 1.3398 Australian dollars)
(Reporting by Jonathan Barrett, Shashwat Awasthi and Byron Kaye; Editing by Sam Holmes and Stephen Coates)
S&P/TSX composite falls to end a third-straight losing week on angst about Fed – CP24 Toronto's Breaking News
TORONTO – The rebound in Canada’s main stock index was short-lived as it pushed lower Friday to end a third-consecutive losing week amid concerns about impending action by the U.S. Federal Reserve.
The S&P/TSX composite index closed down 128.76 points to 20,633.27 despite hitting an intraday high of 20,825.21. The Toronto market had a strong morning start after posting its best performance in 10 months Thursday. It then lost ground throughout the session before recovering a bit approaching the close.
The TSX was down 2.3 per cent on the week but is up 18.4 per cent so far in 2021.
In New York, the Dow Jones industrial average was down 59.71 points at 34,580.08. The S&P 500 index was down 38.67 points at 4,538.43, while the Nasdaq composite was down 295.85 points or 1.9 per cent at 15,085.47.
Investors have been jittery this week in response to the more hawkish comments from the U.S. central bank around speeding up the tapering of bond purchases at the same time as a new COVID-19 variant has surfaces and economic activity is slowing, said Greg Taylor, chief investment officer of Purpose Investments.
“The risk this week is around the Fed making a policy error,” he said in an interview.
Taylor said investors have been nervous in the last few days about the Fed taking away stimulus while the economy in the rest of the world slows down a little bit.
Canadian markets have been somewhat insulated by strong bank earnings.
The heavyweight financials sector was slightly lower on the day, led by a 4.4 per cent drop by Canadian Western Bank. That was partially offset with BMO and CIBC rising 2.4 and 2.1 per cent, respectively, as the Canada’s big banks wrapped up strong quarterly reports that saw them each boost dividends.
Telecommunications was the only sector on the TSX to close higher on Friday.
The broad-based decrease on the TSX was led by health care and the technology sector, which sustained even stronger declines in the U.S.
Tech dropped 2.5 per cent as shares of Hut 8 Mining Ltd. fell 10.8 per cent while Lightspeed Commerce Inc. was down 7.7 per cent and Shopify Inc. was 2.4 per cent lower.
There was a disconnect in the sector’s movement because bond yields were weaker, which is typically a supportive move for these companies.
Big tech stocks have really come under pressure in the last few days as previous pandemic winners such as DocuSign Inc. suffered a 42 per cent decline, Taylor said. 42.2
After starting the day higher, energy lost 0.3 per cent as crude oil prices fell.
The January crude oil contract was down 24 cents at US$66.26 per barrel after climbing as high as US$69.22 in the morning. The January natural gas contract was up 7.6 cents at US$4.13 per mmBTU.
Suncor Energy Inc. and Cenovus Energy Inc. led the declines, losing 2.1 and 1.7 per cent, respectively.
The Canadian dollar traded for 78.05 cents US compared with 78.03 cents US on Thursday.
Materials also fell as copper prices softened while gold was stronger as shares of Lithium Americas Corp. lost 8.7 per cent.
The February gold contract was up US$21.20 at US$1,783.90 an ounce and the March copper contract was down 3.2 cents at nearly US$4.27 a pound.
Earlier, the United States and Canada posted November employment numbers. U.S. non-farm payrolls disappointed as they increased by 210,000 jobs, far below forecasts for about 550,000 jobs. However the unemployment rate fell to 4.2 per cent, the lowest since February 2020.
In Canada, the jobless rate fell to six per cent as 153,7000 jobs were added as the share of the core working population with a job climbed to an all-time high.
Taylor said markets were at risk coming into the week.
“We haven’t had a correction in a long time and were due for some volatility. The question will be when will buyers step back in.”
This report by The Canadian Press was first published Dec. 3, 2021.
Companies in this story: (TSX:CVE, TSX:SU, TSX:CWB, TSX:CM, TSX:BMO, TSX:HUT, TSX:LSPD, TSX:SHOP, TSX:LAC, TSX:GSPTSE, TSX:CADUSD
Google real estate executive says 5% more workers coming in to office each week
Alphabet Inc’s Google has seen an increasing number of employees coming in to its offices each week, particularly younger workers, the company’s real estate chief said during an interview at the Reuters Next conference on Friday.
On Thursday, Google indefinitely pushed back the mandated return date for employees due to concerns about the Omicron variant. The company had previously said its 150,000 global employees could be required to come in to the office as soon as Jan. 10.
Nevertheless, David Radcliffe, Google’s vice president for real estate and workplace services, said many Googlers are returning of their own volition. About 40% of its U.S. employees on average came in to the office daily in recent weeks, up from 20-25% three months ago, he said. Globally, 5% more employees are returning to offices week after week, he added.
“People are actually showing voluntarily that they want to be back in the office,” Radcliffe said. “We’re moving in the right direction.”
Younger employees and those who joined Google more recently have been coming in at higher rates, seeking opportunities to learn from colleagues, Radcliffe added.
Google expects workers in the office at least three days a week once it mandates a new return date.
Based on feedback from those already back, it is redesigning floor plans to increase private, quiet spaces for distraction-free individual work and adding conferencing and other collaboration areas in open spaces both indoors and outdoors.
Real estate and human resources experts have considered Google a trailblazer for the past 20 years in sustainable office design and variety of workplace perks, including free meals, massages and gyms.
To extend those sustainability and wellness benefits to remote work, Google has encouraged employees to buy carbon offsets and non-toxic furniture for their home offices. It also has provided free cooking classes and discounts to fitness studios near workers’ homes.
“It was amazing how many employees had really never cooked themselves,” Radcliffe said.
(Reporting by Paresh Dave in Oakland, Calif., and Julia Love in San Francisco; Editing by Sonya Hepinstall and Matthew Lewis)
S&P/TSX composite down nearly 200 points, U.S. stock markets also lower – Business News – Castanet.net
Canada’s main stock index was down nearly 200 points in late-morning trading, led lower by losses in the technology, base metal and industrial sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 176.86 points at 20,585.17.
In New York, the Dow Jones industrial average was down 160.83 points at 34,478.96. The S&P 500 index was down 48.14 points at 4,528.96, while the Nasdaq composite was down 341.27 points at 15,040.05.
The Canadian dollar traded for 78.05 cents US compared with 78.03 cents US on Thursday.
The January crude oil contract was up US$1.54 at US$68.04 per barrel and the January natural gas contract was up eight cents at US$4.14 per mmBTU.
The February gold contract was up US$14.90 at US$1,777.60 an ounce and the March copper contract was down two cents at US$4.28 a pound.
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