A foot in the market
Birkenstock took a misstep in its IPO. The stock was down by almost 13% at the close of the first day of trading on the New York Stock Exchange, giving the German sandal-maker a lower valuation than it had hoped for when it priced the shares. Other big stockmarket listings this year have been successful on their debut, though the share prices of Arm, Instacart and Klaviyo have all since fallen back.
LVMH, the world’s biggest luxury-goods company and a substantial investor in Birkenstock, reported a sharp slowdown in quarterly sales, a possible sign that the boom in luxury goods since the pandemic is over. It’s “an end to the roaring 20s”, declared analysts at Berenberg, a privately owned bank.
General Motors reached a pay deal with its union in Canada, bringing a swift end to a strike that had only just begun. The agreement increases hourly wages by 20-25%. Meanwhile Ford, GM and Stellantis announced more lay-offs in the United States as a result of the ongoing strike by the United Auto Workers. The UAW escalated its dispute by walking out of Ford’s biggest plant.
Nelson Peltz is gearing up for another proxy fight with Disney and has increased his stake in the company, according to reports. In February the activist investor’s firm, Trian Partners, abandoned its push for a seat on the board after Disney laid out a restructuring plan that seeks to make its streaming service profitable. Since then Disney’s earnings have continued to highlight the underlying weaknesses in its streaming business, causing its stock to fall by 25%.
Country Garden issued another debt-default warning. The Chinese property developer has so far managed to weather the storm that has battered the industry. With sales slumping, the company said its “liquidity position is expected to remain very tight”.
The OECD published the text of a treaty that would make multinational companies, notably tech firms, pay tax in countries where they do business but do not have a physical presence. The alluringly titled Multilateral Convention to Implement Amount A of Pillar One would reallocate $200bnworth of taxing rights, which is expected to benefit poorer countries the most. Meanwhile, Microsoft said it had received a demand for $28.9bn in back taxes from America’s Internal Revenue Service.