Nike shares hit as Kaepernick ad spurs boycott

Eli Harold, Colin Kaepernick and Eric Reid of the San Francisco 49ers kneel on the sideline during the anthem prior to a game against the Dallas Cowboys in 2016. (AFP)
Updated 04 September 2018
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Nike shares hit as Kaepernick ad spurs boycott

  • Calls for a boycott of Nike gained traction on social media following its choice of Colin Kaepernick as a face for the 30th anniversary of its Just Do It slogan
  • Over 30,000 people were tweeting with the hashtag #NikeBoycott on Tuesday morning US eastern time, making it among the top trending topics on Twitter

NEW YORK: Shares of Nike Inc. fell 3 percent on Tuesday as calls for a boycott of the sportswear giant gained traction on social media following its choice of Colin Kaepernick as a face for the 30th anniversary of its “Just Do It” slogan.
Former San Francisco quarterback Kaepernick, the first NFL player to kneel during the national anthem as a protest against racism, posted a black-and-white close-up of himself on Instagram on Monday featuring the Nike logo and “Just do it” slogan, along with the quote: “Believe in something. Even if it means sacrificing everything.”
Over 30,000 people were tweeting with the hashtag #NikeBoycott on Tuesday morning US eastern time, making it among the top trending topics on Twitter. Some posted images of themselves burning and ripping their Nike shoes and apparel.
“First the @NFL forces me to choose between my favorite sport and my country. I chose country,” Twitter user @sclancy79 said in a post retweeted 16,000 times. “Then @Nike forces me to choose between my favorite shoes and my country. Since when did the American Flag and the National Anthem become offensive?,“
Still, there were a large number of other users who took positively to Nike taking a stand on social issues.
Athletes including LeBron James and Kevin Durant showed support, posting images of Kaepernick’s ad on their Instagram profiles.
Even former Iranian President Mahmoud Ahmadinejad weighed in, tweeting: “The #NFL season will start this week, unfortunately once again @Kaepernick7 is not on a NFL roster. Even though he is one of the best Quarterbacks in the league.”
Retail industry analysts were divided on whether the heat around the campaign would be a commercial positive for Nike or ultimately alienate and lose customers.
“The alt-right calls for a Nike boycott will fail just like the boycott of Dick’s Sporting Goods failed,” said Matt Powell, a senior adviser with market research firm NPD Group. “Old angry white guys are not a core demographic for Nike.”
Gun rights supporters called for the boycott of Dick’s Sporting Goods earlier this year after the retailer stopped selling assault rifles and high-capacity magazines following a massacre at a Florida high school in February.
Another analyst, GlobalData Retail’s Neil Saunders, said the campaign will harm Nike in middle America, where it is battle Germany’s Adidas for dominance in the sneaker market.
“The company’s stand may go down well on its native West Coast; it will be far less welcome in many other locations,” he said.
US President Donald Trump has been critical of athletes taking a knee during the national anthem and has said he would love to see NFL owners fire football players who disrespect the American flag.
Nike, who confirmed on Monday that Kaepernick was part of the campaign and called him “one of the inspirational athletes of his generation,” did not immediately respond to requests for comment on Tuesday.


Turkish lira weakens after cenbank repos resume, FX purchase move

Updated 5 min 37 sec ago
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Turkish lira weakens after cenbank repos resume, FX purchase move

ANKARA/ISTANBUL: The Turkish lira weakened on Tuesday after the central bank lowered the swap market lira interest rate and held a repo auction for the first time in nearly two weeks, reversing a policy tightening step it had taken to support the currency.
A currency crisis last year wiped nearly 30% off the lira’s value against the dollar and it has fallen further in 2019.
The lira weakened as far as 6.0860 against the US currency after the central bank moves, compared with a close of 6.0315 on Monday. At 1012 GMT, it stood at 6.0500.
The central bank injected 17 billion lira ($2.8 billion) in the repo, the first since it suspended them on May 9. It lowered the lira interest rate in swap transactions to 24% from 25.5%. Bankers said this would gradually lower the average cost of funding by the same amount, to the bank’s policy rate of 24%.
The steps came as investors weighed up Turkey’s banking watchdog decision to impose a one-day settlement delay for FX purchases of more than $100,000 by individuals. Bankers said that move could raise concerns about capital controls.
“The administration seems to be increasingly desperate to keep the lira stable at all costs ahead of the re-run of the crucial vote in Istanbul,” said Rabobank emerging markets forex strategist Piotr Matys, commenting on the forex purchases move.
“Instead of providing investors with a much needed assurance, such measures will have the opposite effect, as the market will interpret it as rising interference in the banking sector.”
The decision by election authorities to re-run the Istanbul mayoral vote has fueled concerns about an erosion of democracy and unnerved financial markets, helping push the lira down another 13% this year. The ruling AK Party’s narrow defeat in the initial election in March was the first time in 25 years that President Tayyip Erdogan’s party or its Islamist predecessors had lost control of Turkey’s biggest city.
Matys said the repo move was a contradictory measure at a time when Turkey needs to restore confidence in the lira.
“Such conflicting policies make Turkey increasingly unpredictable and keep the upside bias in USD/TRY intact,” he added, saying initial resistance was around 6.2282, with a break higher exposing the 6.46-6.50 area as the next potential target.
HIGH-FREQUENCY TRADERS TARGETED
A BDDK watchdog letter sent to banks on Monday said the settlement date for those purchases of more than $100,000 — or equivalent in other currencies — will be the following day.
“This one-day delay on FX transaction for retail investors is curious, especially when they take away the increase in rates in the morning,” said Charles Robertson, global chief economist at Renaissance Capital. “It’s a hint of capital controls, and the threat of more is implicit.”
Beste Naz Sullu, of Gedik Investment, said the BDDK was trying to curb foreign exchange speculation, but added that the market “does not like measures such as this much.”
The BDDK said on Tuesday the forex purchases move, effective from Tuesday, aimed to prevent “unnecessary and unjust harm” to the market, particularly by high-frequency traders.
Authorities have recently taken unorthodox steps to protect the currency, including state banks selling dollars. Ankara also raised a tax on some foreign exchange sales to 0.1% from zero last week to discourage Turks converting savings to foreign currencies.
Turks have flocked to foreign currencies in the months since last year’s crisis hit its peak in August, when the lira fell as much as 42% against the dollar.
The lira woes helped tip the economy into recession last year and Turkish Statistical Institute data on Tuesday showed consumer confidence tumbled to 55.3 points in May, the lowest level since the data was first published in 2004.
The main share index fell 1.26 percent.