E A Sell-Off Day

Yesterday was another one of those busy days in global investing, with an extra negative, because markets were tanking because Trump was escalating the trade war rhetoric against China. Given what we know about how he negotiates, this is almost certainly a tactic to force a reluctant China to give up more to keep trade flows open. Pres. Trump considers himself to be a deal-maker extraordinary and has form in these matters.

Giving him credit for how he is handling China is not the same thing as taking his side over the Russian investigation, and I compared risks from his attacks on the FBI to Nixon's obstruction of justice over Watergate. A reader cancels his sub over this. We can afford it.

The SEC investigation of uncovered short selling of American Depository Receipts by depository banks has now broadened. JP Morgan REVEALED it is under investigation for actions in 2011-2015, following the SEC publication of an investigation of short selling by Deutsche Bank's ADR arm last week.

The Bank of England raised rates to over 0.5% for the first time since the global financial crisis hit and this chopped stock prices. Markets are trending downward also over trade war concerns. I think it is faint, but I may be wrong.

*Canadian telco BCE reported on its Q2 yesterday and missed consensus for both revenues and earnings. Revenues at C$5.79 bn were up from last year but below the $5.81 bn analyst consensus. Adjusted earnings were even worse, at C$777 mn. EPS was down prior year's 89 loony cents which analysts expected it to match, at a mere 86 cents.

BCE shares fell 2.2% in US trading at the open but recovered a bit after the conference call linked the results to costs for upgrades of its network. It is getting contracts to bring the Internet to government facilities, schools, libraries, and hospitals in Alberta and a 6-yr Canada IT contract.

BCE reiterated its outlook for revenues this year rising 2-4% and EPS rising 1-4%Its adjusted cash flow (earnings before interest, taxes, depreciation, and amortization or EBITDA) rose 2% to $2.430 bn and its EBITDA rose 5 basis points to a comfortable 42%, thanks to higher postpaid wireless signups up over 44%. Its cheapo Lucky Mobile prepaid service is now national, and grew even baster.

This boosted cellphone revenues by 5%, of course at the cost of landlines. Broadband was also hot, with over 76% more signups, from a lower base. It is offered 4G fiberoptic TV in some provinces, starting with Manitoba.

BCE yesterday launched a 1.5 gigabit home service at Canada's fastest speed, 30% faster than rival systems (if you believe PCMag) starting in the Maritime provinces, Quebec, and Manitoba.

BCE shares fell 2.2% in US trading at the open but recovered a bit. BCE reiterated its outlook for revenues this year rising 2-4% and EPS rising 1-4%.

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