Tadawul breaches 7,000 mark on Q4 earning hopes

Updated 05 January 2013
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Tadawul breaches 7,000 mark on Q4 earning hopes

Saudi shares ended higher yesterday lifted by gains in the petrochemical and banking sectors.
The benchmark stock index rose to the highest in more than three months while investors await domestic fourth-quarter earnings.
“There is a feeling of optimism in the local market at the kickoff of 2013 driven mainly by the promising budget,” said Basil Al-Ghalayini, CEO OF BMG Financial Group.
Saudi Basic Industries Corp. (SABIC) advanced to the highest since Dec. 22. SABIC rose 0.8 percent to SR 92.25.
The banking index also gained 0.7 percent.
Tamer El Zayat, senior economist at the National Commercial Bank (NCB), said: “Momentum of buying is still going strong based on increased budget allocations across the board to all sectors of the economy and the expected profitability and dividends growth.”
He said Saudi banks are expected to record double-digit growth on the back of loan growth and noninterest income while the petrochemical sector is benefiting from higher oil prices. The Tadawul All-Share Index surged 1 percent to 7,010 points yesterday.
That’s the highest since Sept. 22, according to data compiled by Bloomberg.
Asim Bukhtiar, vice president/head of research at Riyad Capital, said the Saudi market reacted to positive jobs numbers out of the US and the S&P hitting its five-year high. “Domestically, investors are taking positions ahead of the results announcements as Q4 earnings season kicks off this week,” said Bukhtiar.


Harley-Davidson to move some production out of US to avoid EU tariffs

Updated 25 June 2018
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Harley-Davidson to move some production out of US to avoid EU tariffs

  • The shift in production is an unintended consequence of Trump’s administration imposing tariffs on European steel and aluminum
  • In response to US tariffs, the EU began charging import duties of 25 percent on a range of US products

Harley-Davidson Inc. said on Monday it would move production of motorcycles shipped to the European Union from the United States to its international facilities and forecast the trading bloc’s retaliatory tariffs would cost the company $90 million to $100 million a year.
The shift in production is an unintended consequence of US President Donald Trump’s administration imposing tariffs on European steel and aluminum early this month, a move designed to protect US jobs.
In response to the US tariffs, the European Union began charging import duties of 25 percent on a range of US products including big motorcycles like Harley’s on June 22.
In a regulatory filing https://bit.ly/2tA1ru0 on Monday, the Milwaukee, Wisconsin-based company said the retaliatory duties would result in an incremental cost of about $2,200 per average motorcycle exported from the United States to the European Union, but it would not raise retail or wholesale prices for its dealers to cover the costs of the tariffs.
The company expects the tariffs to result in incremental costs of $30 million to $45 million for the rest of 2018, the filing said.
“Harley-Davidson believes the tremendous cost increase, if passed onto its dealers and retail customers, would have an immediate and lasting detrimental impact to its business in the region,” the company said.
Struggling to overcome a slump in US demand, Harley has been aiming to boost sales of its iconic motorcycles overseas to 50 percent of total annual volume from about 43 percent currently.
In January, the company announced the closure of a plant in Kansas City, Missouri as part of a consolidation plan after its motorcycle shipments fell to their lowest level in six years.
In 2017, Harley sold nearly 40,000 new motorcycles in Europe which accounted for more than 16 percent of the company’s sales last year. The revenues from EU countries were second only to the United States.
Harley said ramping-up production at its overseas international plants will require incremental investments and could take at least nine to 18 months.
The company will provide more details of the financial implications of retaliatory EU tariffs and plans to offset their impact on July 24 when its second-quarter earnings are due, the filing said.
Trump vowed to make the iconic motorcycle maker great again when he took office last year.
In late April, Harley said Trump’s metal tariffs would inflate its costs by an additional $15 million to $20 million this year on top of already rising raw material prices that it expected at the start of the year.