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The Wall Street Journal - 19 October 2017

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THURSDAY, OCTOBER 19, 2017 ~ VOL. CCLXX NO. 93
* * * * *
DJIA 23157.60 À 160.16 0.7%
NASDAQ 6624.22 À 0.01%
What’s
News
STOXX 600 391.56 À 0.3%
10-YR. TREAS. g 11/32 , yield 2.339%
OIL $52.04 À $0.16
Relentless Rally
Aside from a few modest pullbacks
over the summer, the Dow industrials
have climbed steadily since their
previous milestone.
Business & Finance
T
he Dow powered past
23000, rising 160.16
points to 23157.60 as IBM
shares surged. But some investors and analysts are concerned about the outflows
from U.S. stock funds. A1, B11
23000
Close
Open
Reckitt is splitting its
business into two separate
divisions as the consumergoods firm struggles with an
industrywide slowdown. B1
Anthem is launching its
own pharmacy-benefits
manager, dealing a blow to
partner Express Scripts. B1
Hedge funds that bet on
declines in the dollar, pound
and government-bond yields
have been stung by the prospect of rate increases. B1
Sweden’s EQT agreed to
pay Pritzker about $250
million for medical-device
firm Clinical Innovations. B1
The FDA cleared Gilead’s
cell-therapy treatment for
advanced lymphoma. B3
Ascent Resources is preparing for an IPO or sale of
the oil-and-gas driller. B3
U.S. Bancorp’s profit rose
4% to a record $1.56 billion,
but analysts raised concerns
about loan growth. B10
22500
22250
22000
21750
21500
Sept.
Oct.
Source: WSJ Market Data Group
BY CORRIE DRIEBUSCH
AND MICHAEL WURSTHORN
The Dow Jones Industrial
Average powered past 23000
on Wednesday, but the latest
milestone masks a potentially
perplexing trend: Investors
keep yanking money out of
stock funds.
Investors pulled roughly a
net $36 billion out of U.S.
stock mutual and exchangetraded funds in the third quarter, according to EPFR Global.
Overall in 2017, more money
The S&P 500 hasn’t suffered
a daily pullback of 3% or more
since Nov. 4, the longest
stretch without a decline of
that magnitude since the
mid-1990s. So far this year the
Dow has surged 17%, compared
with the S&P 500’s 14% rise.
Some investors worry that
means stocks are overdue for a
substantial selloff.
Others think the money
leaving U.S. stock funds is a
positive development. The outflows have coincided with elevated cash holdings and could
signal major indexes can climb
even higher. They figure with
less invested in U.S. stock
funds, there is plenty of money
to put back in if investors get
more optimistic.
These analysts and inves-
INSIDE
An Olympic gymnast alleged that she was sexually
assaulted by the former U.S.
national team doctor. A3
The suspect in the shooting of six people, three fatally,
was captured in Delaware. A3
CONTENTS
Business News.. B3,5
Capital Account.... A2
Crossword.............. A14
Heard on Street. B12
Life & Arts....... A11-13
Markets............. B11-12
Middle Seat.......... A13
Opinion.............. A15-17
Sports....................... A14
Technology............... B4
U.S. News............. A2-5
Weather................... A14
World News....... A6-9
>
s Copyright 2017 Dow Jones &
Company. All Rights Reserved
Insurers brace for a drop in
enrollment................................... A4
Islamic State’s Other Grisly
War, a World Away From Syria
Islamists in the Philippines pledged allegiance to ISIS, devastated
a city and built a model for jihadists after the fall of Raqqa
BY JAKE MAXWELL WATTS
MARAWI, Philippines—On the third day of
his captivity, during one of the most violent
jihadist rebellions outside the Middle East
and Africa, Ronnel Samiahan watched Islamist militants make an example of a fellow
hostage who had tried to break free.
After dragging the conscious man onto
the street and pulling his head up by the
hair, the militants began sawing at his neck
with a knife. Five minutes later, the executioner thrust the severed head toward the
remaining hostages, warning, “If you try to
escape, this is what is going to happen to
you,” recalled Mr. Samiahan, a Christian local laborer.
Islamist militants took over this city of
200,000 people in late May, modeling themselves on Islamic State, or ISIS. Philippine
soldiers, assisted by the U.S. military, struggled to reclaim it.
Philippine authorities on Monday said two
of the militants’ most senior leaders had
THE POP DIVA
IDENTITY CRISIS
LIFE & ARTS, A11
AMEX CEO
CHENAULT TO
STEP DOWN
BUSINESS & FINANCE, B1
Thousands of Kurds fled
northern Iraq, fearing harassment from Iraqi forces
and government militias. A7
Sessions defended his
role in the firing of Comey
as FBI director at a hearing
before a Senate panel. A4
Bull market paints itself into
a corner......................................... A5
Chevron
53.1
Dow Races Through 23000
has flowed out of such funds
than has flowed in, EPFR data
show, even as the Dow has
climbed to 51 fresh highs this
year. A surge in stock buybacks and growing inflows
from foreign investors and
sovereign-wealth funds helped
offset outflows from U.S. stock
funds.
Many investors are concerned that the steady rise in
U.S. indexes has left shares
looking expensive. They also
recently have grappled with elevated tensions between the
U.S. and North Korea, hurricane-related disruptions to the
economy and signals that the
Federal Reserve is planning to
raise interest rates further and
wind down its unprecedented
asset-purchase program.
Trump
Cools on
Health
Law Deal
tors reckon some caution is
healthy in a rising market.
What would make them worry
that a peak may be near, they
say, is the kind of exuberance
they remember seeing from investors in the dot-com boom
in the late-1990s.
“As we hit milestones, it
creates a lot of dialogue
around ‘oh my goodness the
market is at all-time highs yet
again,’” said Erik Davidson,
chief investment officer at
Wells Fargo Private Bank. He
said investors he speaks with
are happy their stock portfolios are going up, but they’re
also perplexed, concerned
Please see DOW page A5
McDonald's
63.1
THE WALL STREET JOURNAL.
Earnings drive latest leg
up, but money has
recently been flowing
out of stock funds
YEN 112.93
WASHINGTON—A bipartisan proposal on health care
teetered Wednesday after
President Donald Trump withdrew his support and conservative GOP lawmakers said it
didn’t do enough to roll back
the Affordable Care Act.
The two senators behind
the deal, Lamar Alexander (R.,
Tenn.) and Patty Murray (D.,
Wash.), remained publicly upbeat about the bill’s prospects
despite the president’s conflicting statements.
Mr. Trump touched off confusion on Capitol Hill Wednesday morning, tweeting he “can
never support bailing out ins
co’s who have made fortune w/
O’Care,” echoing criticism from
conservatives that the deal is a
bailout for insurers, a characterization the sponsors dispute.
In previous days, the president had expressed public support, calling the proposal a
“very good solution” on Tuesday. Before Mr. Trump sent
Wednesday’s tweet, the GOP
president called Mr. Alexander
privately to encourage him to
get the agreement done, the
senator said.
Mr. Trump’s comments on
Wednesday cheered conservatives, troubled some Republicans who support the bill and
Please see HEALTH page A4
UnitedHealth Group
84.0
Johnson & Johnson
58.7
Aug. 2
EURO $1.1787
BY STEPHANIE ARMOUR
AND KRISTINA PETERSON
88.6
Clinton criticized
Trump’s bellicose language
toward North Korea, saying
it damaged U.S. interests. A6
Trump’s new travel ban
was blocked by a judge in
Maryland, a day after a judge
in Hawaii rejected it. A3
Home Depot
89.2
3M
Tillerson said the U.S.
and India share interests
and values and criticized
China ahead of his trip to
the South Asian nation. A6
Islamic State faces a
cash-strapped future as territory in Iraq and Syria slips
from the extremists’ grip. A7
IBM
103.9
World-Wide
China’s Xi set the goal of
building a modern nation by
2035 and stressed Communist Party authority as he
opened a party congress. A6
125.2
Goldman Sachs Group
108.6
Range
Hearst is buying magazine publisher Rodale, giving
it a major presence in the
health and wellness area. B3
Trump withdrew his
support for a bipartisan
health-care plan and conservative GOP lawmakers
said it didn’t do enough to
roll back the ACA. A1
Insurers are bracing for
a drop in enrollments for
ACA plans because of
higher rates and confusion
about the law’s status. A4
Top point contributions
since first close above 22000
Boeing
152.0
Caterpillar
GE’s chief is expected next
month to unveil results of a
global review that includes
thousands of job cuts and a
global retrenchment. A1
Chenault will step down
as American Express chairman and CEO next year. He
will be succeeded by Vice
Chairman Squeri. B1
GOLD $1,279.90 g $3.10
22750
Dow Jones Industrial Average
since first close above 22000
HHHH $4.00
WSJ.com
New Chief at
GE Starts
Undoing the
Costly Past
BY THOMAS GRYTA
AND JOANN S. LUBLIN
John Flannery, the leader of
General Electric Co. for just
2½ months, has begun dismantling the legacy of his predecessor, including the planes.
For much of Jeff Immelt’s
16-year run atop one of the
world’s largest conglomerates,
an empty business jet followed
his GE-owned plane on some
trips to destinations around
the world, according to people
familiar with the matter. The
two jets sometimes parked far
apart so they wouldn’t attract
attention, and flight crews
were told to not openly discuss the empty plane.
The second plane was a
spare in case Mr. Immelt’s jet
had mechanical problems. A
GE spokeswoman said that
Please see GE page A9
Here’s a Funny Idea: This Hit
Comedy Show Has a ‘G’ Rating
i
i
i
Brigham Young troupe racks up laughs
with no vulgarity; two guys on a scooter
been killed, including one on Washington’s
list of most-wanted terrorists, and that it
was a few days from securing the city. Philippine President Rodrigo Duterte on Tuesday
declared the city liberated.
The militants’ occupation—and the military’s siege—has left Marawi in ruins, with
more than 1,000 soldiers, civilians and militants killed and many neighborhoods devastated by airstrikes. A few dozen militants remain in the city, the military said on Tuesday.
The Marawi battle shows how militant
groups outside the Middle East and Africa
are finding a template in Islamic State, not
just as an exporter of terrorism, but also as
a holder of territory. ISIS itself is looking for
new beachheads having been pushed out of
strongholds such as its de facto capital of
Raqqa, Syria, which U.S.-backed forces said
they captured this week.
“They look around the globe,” said Colin
Please see WAR page A10
ISIS faces cash-strapped future............................. A7
World’s First
“Self-Driving”
Database
BY BRADLEY OLSON
took a picture with them, recognized them as the stars of
Conan O’Brien and his family Studio C, a sketch comedy
were out to dinner in Santa show out of Brigham Young
Monica last year when his University.
Studio C has achieved sizdaughter began to screech, “Oh
my God! Oh my God! Oh my able popularity on the internet,
despite—or perhaps because
God!”
“I thought a Cessna had just of—its super-scrubbed brand of
clean
humor,
plowed into the
such
as
sidewalk
and
a skit about a
burst
into
soccer
goalie
flames,” the latenamed
Scott
night TV host reSterling who accalls. “Then my
cidentally, and
son started to
‘Scott Sterling’
a g o n i z freak out and he
ingly,
blocks
was like, ‘They’re
crossing the street! They’re shots with his face.
Working blue is out of the
crossing the street!’”
The source of the pandemo- question for this comedy
nium was the arrival of what troupe. BYU, run by the Church
Mr. O’Brien’s children deemed of Jesus Christ of Latter-day
some bigger celebrities: a few Saints, has ranked as the namild-mannered Mormons. The tion’s most “Stone Cold Sober”
late-night TV host, who soon Please see LAUGHS page A10
Oracle
Autonomous
Database
No Human Labor – Half the Cost
No Human Error – 100x More Reliable
oracle.com/selfdrivingdb
Human labor refers to tuning, patching, updating, and maintenance of database.
Copyright © 2017, Oracle and/or its affiliates. All rights reserved.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A2 | Thursday, October 19, 2017
THE WALL STREET JOURNAL.
* ***
U.S. NEWS
CAPITAL ACCOUNT | By Greg Ip
Weakened Nafta, WTO Pave Way for Conflict
Before a
war, the antagonists remove the
peacekeepers.
Trade wars
start the same way.
President Donald Trump
is trying to remake or withdraw from the North American Free Trade Agreement,
and his administration is
also weakening the World
Trade Organization. Sidelining the peacekeepers that
enforce the rules of global
trade would free up the U.S.
to impose tariffs without
fear of an arbiter contradicting its decision. The administration’s punitive 299%
preliminary tariff against
aircraft built by Canada’s
Bombardier Inc. might be an
early glimpse of this.
This may deliver shortterm victories to Mr. Trump,
but at what cost? Roberto
Azevedo, the WTO’s chief,
told a Council on Foreign Relations conference this week
that a world without multilateral arbitration is one
“ruled by unilateral actions,
which is basically a euphemism for trade wars,
and…we’d all be, without exception, worse off than we
are now.”
The U.S. has long been an
enthusiastic trade warrior.
Since 1995, it has brought
nearly 900 antidumping
cases (against firms selling
in the U.S. below cost or
what they charge at home),
countervailing cases (for illegal government subsidies) or
safeguard cases (to protect
against surges of imports),
according to the WTO, more
than any other country.
One of Nafta’s primary appeals to Canada and Mexico
was protection from some of
these U.S. enforcement actions, and the ability to ask a
binational panel to rule if
they were in accordance with
U.S. law. “It’s the dispute
resolution process, not low
tariffs, that is the jewel in
the Nafta crown,” said CIBC,
a Canadian bank, in a recent
report. Elimination of that
process is a key U.S. demand.
W
hen the WTO replaced the General
Agreement on Tariffs and Trade in 1995, it
brought a dispute-settlement
mechanism under which
member countries could appeal another’s trade action
to a panel, and if necessary
appeal to a seven-member
appellate body. The Trump
administration is now blocking appointments to fill sev-
aging companies to file
complaints, and to expect
more favorable treatment.
In theory, officials at both
the Commerce Department,
which decides whether
dumping or subsidies exist,
and the U.S. International
Trade Commission, which
determines if duty is justified, follow objective, legal
criteria. In practice, they
are influenced by the political winds.
Bombardier decried its
tariff as “egregious overreach.” Canadian Foreign
Minister Chrystia Freeland
called it “baseless and absurdly high.” Nonetheless,
faced with heavy debt, sluggish orders and potentially
years of litigation to overturn the tariff, Bombardier
said it would partner with
Airbus SE and build some
jets in Alabama.
This looks like a shortterm win for Mr. Trump’s
trade unilateralism. But is it
a long-run win? Mr. Trump’s
trade policy is based on two
questionable premises. One
is that deficits show the U.S.
has been a loser on trade.
Almost no economist agrees,
arguing trade deficits reflect
a more fundamental imbalance between national saving and investment. If U.S.
Shots Across the Border
The U.S. is a vigorous user of trade-enforcement measures against
others, especially since the last recession.
Number of trade actions
initiated by the U.S.
Number of trade actions
brought against the U.S
100
100
Safeguard*
Countervail
(antisubsidy)
Antidumping
75
75
50
50
25
25
0
0
1995
2000
1995
’10
*No data for safeguard cases brought against the U.S.
Source: World Trade Organization
eral vacancies on that appellate body, imperiling its
work, over how it interprets
U.S. antidumping authority.
Yet the administration’s
complaints go deeper: It
thinks the mechanism infringes on American sovereignty.
While the panels haven’t
prevented trade disputes,
they have kept them from
spiraling out of control, and
their mere existence may
also have discouraged more
dubious cases.
2000
’10
THE WALL STREET JOURNAL
That may no longer be
true. Wilbur Ross, Mr.
Trump’s commerce secretary,
has made increased enforcement a priority. Antidumping
and countervail investigations are up 48% from a year
ago. Mr. Ross has dusted off
long-disused trade remedies
to impose tariffs on Chinese
solar panels and Korean
washing machines and to explore curbing steel imports
for national-security reasons.
The White House’s newly
aggressive stance is encour-
MARK GAIL/THE WASHINGTON POST/GETTY IMAGES
A nearly century-old, 40foot cross honoring World
War I veterans in Bladensburg,
Md., represents an unconstitutional endorsement of religion,
a divided federal appeals court
ruled Wednesday.
In a 2-1 decision, a panel of
the Fourth U.S. Circuit Court
of Appeals in Richmond, Va.,
found
that
the
cross
“breaches” the wall of separation between church and state.
At least one other appeals
court has pronounced a memorial cross on government
land as unconstitutional. But
Wednesday’s ruling marked
the first time a circuit court
has ruled against a cross in a
World War I memorial, according to lawyers.
The concrete Celtic cross
was erected in 1925 by the
American Legion and towers
above a pedestal on a busy
highway median about a halfhour drive from Washington,
D.C. The site honors 49 men
from Prince George’s County
who died in World War I.
The
Maryland-National
Capital Park and Planning
Commission,
a
bicounty
agency, acquired title to the
A federal appeals court ruled a World War I veterans memorial in
Bladensburg, Md., ‘breaches’ the wall between church and state.
property in 1961.
The American Humanist Association sued the agency in
2014, arguing that the cross
violates the First Amendment’s Establishment Clause,
which bars the government
from making any law “respecting an establishment of religion.”
Judge Stephanie D. Thacker,
who wrote the majority opinion for the panel, analyzed the
constitutional question by asking what a “reasonable objective observer” would think
when passing by the memo-
rial. That observer, she concluded, would perceive the
cross as an endorsement of
the Christian faith, noting its
size.
Judge Thacker said another
factor weighing against the
cross was the more than
$200,000 that the park commission has spent or earmarked over the years to
maintain and preserve the
site. That money, she wrote,
excessively entangled the government in religion.
Judge Thacker’s opinion
was joined by Judge James A
F
or similar reasons,
America’s partners
may feel compelled to
retaliate against U.S. protectionism if Nafta or the WTO
aren’t available as relief
valves—the trade wars Mr.
Azevedo warns of. That
need not be the end of the
world: It wasn’t in the
1980s. The difference is that
Ronald Reagan indulged protectionist pressures while
laying the groundwork for a
future liberalization of
trade. Mr. Trump has a different path in mind.
CORRECTIONS AMPLIFICATIONS
Court Calls Memorial Unconstitutional
BY JACOB GERSHMAN
protectionism hurts Mexico,
its economy and currency
will weaken, reducing demand for U.S. exports and
undercutting any narrowing
in the trade deficit.
The second premise is
that the U.S. has the leverage
because other countries
prize access to its markets.
Yet both Mexico and Canada
have indicated they would
sooner let Nafta die than accept some of Mr. Trump’s
conditions. In part, they believe the three economies
are so integrated that many
trade relationships would
persist. And in part, it’s because accepting an inferior
deal could exact a steep economic and political price.
China is the largest emitter of carbon dioxide in the
world, and the U.S. is the second largest. A Business & Finance article on Wednesday
incorrectly said the U.S. was
the largest emitter of carbon
dioxide.
Wynn Jr., both of whom were
appointed by President Barack
Obama.
“It’s a cross much more
clearly and obviously than a
memorial,” said David Niose, a
lawyer for the humanist association.
Hiram Sasser, a lawyer with
the First Liberty Institute, a
legal group that advocates for
religious freedom and represents the American Legion, a
co-defendant in the litigation,
said the defendants are considering their appeal options
and may ask the Supreme
Court to review the Fourth
Circuit’s decision.
“It would be shameful for
our nation to tear down a veterans memorial almost a hundred years after it was put
up,” said Mr. Sasser.
Judge Roger L. Gregory, the
chief judge of the circuit court
appointed by President Bill
Clinton, dissented, finding that
a reasonable observer would
view the Bladensburg cross as
less a promotion of Christianity than a historical monument.
Judges in recent years have
disagreed about the constitutionality of memorial crosses
on government property.
The health-insurance deal
struck by Sens. Lamar Alexander and Patty Murray
would expand the usefulness
of waivers that allow states
to sidestep certain Affordable
Care Act rules to remold
some aspects of the law, such
as how premium subsidies are
distributed. A U.S. news article Wednesday incorrectly
said it also allows states
more say on how much insurers can charge their older
customers.
Readers can alert The Wall Street Journal to any errors in news articles by
emailing wsjcontact@wsj.com or by calling 888-410-2667.
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THE WALL STREET JOURNAL.
* *
Thursday, October 19, 2017 | A3
U.S. NEWS
Second Judge Rejects Ban
WASHINGTON—A federal
judge in Maryland partially
blocked the Trump administration on Wednesday from
implementing its latest version of the travel ban, a ruling
that came a day after a judge
in Hawaii issued an order preventing the government from
imposing much of the ban.
President Donald Trump’s
latest travel restrictions, issued Sept. 24, had been set to
take full effect Wednesday, but
that is now on hold because of
the two rulings. The new ban
applies to eight countries—the
Muslim-majority nations of
Chad, Iran, Libya, Somalia,
Syria and Yemen, as well as
North Korea and some government officials in Venezuela.
The Hawaii and Maryland
judges found that the latest
ban is likely unlawful. Together their rulings block restrictions against the Muslim-
SHAWN THEW/EUROPEAN PRESSPHOTO AGENCY
BY BRENT KENDALL
The travel ban sowed confusion at airports earlier this year.
majority nations, but they
don’t prevent the ban from applying to the two non-Muslim
countries.
Overall, Mr. Trump, a Republican, has tried to impose three
different versions of the travel
ban this year, but the objections from federal judges have
remained largely the same.
The Maryland ruling didn’t
embrace all of the arguments
made by immigrant-rights
groups and individual plaintiffs challenging the ban. But
the decision, by U.S. District
Judge Theodore Chuang, was a
broad one, finding Mr.
Trump’s new ban was tainted
by the same kind of religious
animus that he and other
judges found in the previous
two bans.
Judge Chuang, who also
ruled against the president in
March on the second version
of his travel ban, wrote that
Mr. Trump has never repudiated the calls he made during
the presidential campaign for
a ban on Muslims entering the
U.S. He found that Mr. Trump
continues to make questionable comments that hang over
the new policy, quoting several
recent tweets by the president.
The Justice Department
vowed quick appeals in both
rulings. The cases could end
up on a fast track to the Supreme Court, which hasn’t yet
had a chance to rule definitively on any of Mr. Trump’s
bans. The justices did impose
interim rules this summer that
allowed the president to impose parts of his second ban.
Both judges said their rulings applied nationwide.
" . . .T H E M O S T F L E X I B L E O F T H E
U.S. JET MEMBERSHIP PROGRAMS"
MIKE BLAKE/REUTERS
Conklin & de Decker
Olympian McKayla Maroney before the 2012 London Olympics. She has accused a former U.S. national team doctor of sexual abuse.
Gymnast Alleges Abuses by Doctor
BY REBECCA DAVIS O’BRIEN
Olympic gold-medal-winning gymnast McKayla Maroney said that she was repeatedly sexually assaulted by
the former U.S. national team
doctor, including at the 2012
London Olympics.
In a statement posted on
Twitter on Wednesday, Ms.
Maroney alleged that Larry
Nassar abused her, under the
guise of medical treatment,
from the time she was 13
years old until she stopped
competing in the sport in
2013. In what she called the
“scariest night of my life,” Ms.
Maroney described waking up
alone in Dr. Nassar’s hotel
room after a flight to Tokyo—
on which she alleged he had
given her medication to help
her sleep—to find him giving
her “treatment.”
Ms. Maroney was 15 at the
time, and had traveled to Tokyo in 2011 with the U.S.
women’s national team for the
world championships. Ms. Maroney announced her retirement in early 2016.
Ms. Maroney, now 21, is
among scores of women, including former national team
members and decorated Olympians, who have accused Dr.
Nassar of sexual abuse, in lawsuits and in media reports.
The majority of women in
the lawsuits—most brought in
federal court in Michigan,
where Dr. Nassar lived and
Suspect Is Captured
After Two-State Spree
BY SCOTT CALVERT
A daylong manhunt ended
Wednesday evening when authorities captured a man suspected of shooting five coworkers, three fatally, at a
Maryland countertop business
and then shooting a sixth person 50 miles away in Wilmington, Del.
The suspect, 37-year-old
Radee Prince, was taken into
custody in Delaware by agents
from the federal Bureau of Al-
‘Words cannot
express our feelings.
We mourn the loss
of our friends.’
cohol, Tobacco, Firearms and
Explosives and other law-enforcement agencies, the Harford County, Md., sheriff’s office said on Twitter around
7:30 p.m.
Authorities say Mr. Prince
used a handgun to shoot five
people at Advanced Granite
Solutions before 9 a.m. Three
victims died and two were in
critical condition. Harford
County Sheriff Jeffrey Gahler
said it was a targeted attack.
Around 10:45 a.m., the gunman went to a Wilmington car
dealership and shot a man
twice, once in the head, Wilmington Police Chief Robert
Tracy said. The victim was
conscious and is expected to
survive, the chief said.
Chief Tracy said the sixth
victim was able to identify Mr.
Prince as his assailant. The
chief said the man and Mr.
Prince “have a past history together, they’ve had beefs,” but
didn’t elaborate.
The chief said the attacks
weren’t random. “This individual knew the people he wanted
to go shoot,” he said.
Wilmington police officers
who responded to the dealership saw Mr. Prince’s vehicle as
he drove away, Chief Tracy said.
Chief Tracy said Mr. Prince
has been arrested 42 times in
Delaware, resulting in 15 felony convictions and four misdemeanor convictions.
Mr. Prince worked at Advanced Granite Solutions for
the past four months and had
been scheduled for “a regular
workday” Wednesday, Sheriff
Gahler said. He said he knew
of no motive for the shooting.
The company is in a business
park in the Edgewood area of
Harford County, about 20
miles northeast of Baltimore.
The company posted a message on Facebook that read in
part: “Words cannot express
our feelings. We mourn the
loss of our friends.”
worked—allege that Dr. Nassar
inserted his ungloved fingers
into the vaginas of young girls
and women in his medical
care, for up to an hour at a
time, in what he said was a
treatment for muscle pains
and other ailments.
Through his lawyers, Dr.
Nassar has defended his use of
intravaginal adjustment, an
accepted but rare form of socalled osteopathic manipulative treatment for certain
muscular pain in which a doctor massages the internal wall
of the vagina.
Dr. Nassar pleaded guilty in
July to federal child pornography counts and is set to be
sentenced in December. Dr.
Nassar still faces multiple law-
suits, criminal sex-abuse
charges in Michigan, and an
open inquiry by the Federal
Bureau of Investigation into
his activities with the U.S. national team, according to court
filings and a spokeswoman for
the FBI.
A lawyer for Dr. Nassar declined to comment on Ms. Maroney’s allegations.
In a statement, a spokeswoman for USA Gymnastics
said the organization is “outraged and disgusted” by Dr.
Nassar’s alleged abuse of athletes and is strengthening its
sexual-abuse policies.
A representative for John
Manly, one of Ms. Maroney’s
lawyers, said Ms. Maroney
wasn’t granting interviews.
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THE WALL STREET JOURNAL.
U.S. NEWS
Insurers Brace for a Drop in Enrollment
Higher rates for ACA
plans and confusion
about the law’s status
cloud outlook for 2018
Lower-Cost Plans
Expected to Gain
Insurers will likely be helped
by an automatic re-enrollment
process that remains in effect
for this year, pushing passive
consumers into new plans under the Affordable Care Act.
But that automatic process
could mean some consumers
will be signed up for coverage
with big rate increases and
won’t realize it until they are
billed later on.
“We’re trying to remind people, ‘shop, shop, shop,’ ” said
Geoff Bartsh, a vice president
at Medica, an ACA insurer.
Medica, which is raising
rates around 30% or more in
BY ANNA WILDE MATHEWS
HEALTH
Continued from Page One
left many Democratic lawmakers frustrated. Some Capitol
Hill aides said they thought
Mr. Trump’s remarks might be
a negotiating tactic to get
more concessions from Democrats, and GOP lawmakers began looking at potential
changes that might ultimately
get the president’s backing.
The White House disputed
the notion that the president
was changing his mind.
Spokeswoman Sarah Huckabee
Sanders said the administration had “said all along” it
wouldn’t favor a bill that was a
gift to insurance companies.
Still, Ms. Sanders described
the proposal from Mr. Alexander and Ms. Murray as a “good
step in the right direction,” noting that the president supports
Democrats and Republicans
working together.
“But it’s not a full approach,”
Ms. Sanders said, “and we need
something to go a little bit further to get on board.”
Democrats suggested Mr.
Trump’s stance on Wednesday
marked the latest reversal that
could jeopardize bipartisan
deals that had seemed possible
recently on a variety of issues,
including immigration.
Democrats said they believed
they had reached the framework of a deal with Mr. Trump
on immigration last month, but
ments to insurers that are
used to reduce health-care
costs for low-income ACA enrollees. Partly because of the
anticipated loss of those federal payments, expected to total $7 billion this year, major
insurers are sharply raising
rates in many states.
And many firms say they
expect to lose consumers who
will bear the full brunt of the
rate increases—those who
aren’t eligible for the health
law’s premium subsidies,
which help enrollees with annual incomes of less than
around $48,000.
“The people we’ll lose will
likely be the ones who have afthe White House then released
a list of conservative policy demands that Democrats said rendered the deal impossible.
“This president can’t govern
if whenever the hard right
frightens him and says ‘Jump,’
he says, ‘How high?’” Sen.
Chuck Schumer of New York,
the chamber’s Democratic
leader, said. “If he keeps backing off and changing on everything, his presidency will be an
utter failure.”
Mr. Schumer described the
president as “totally inconsistent.”
The bill now faces significant hurdles in both the Senate and House. A spokesman
for House Speaker Paul Ryan
(R., Wis.) said nothing had
changed his view that the Senate should stay focused on repealing the 2010 law known as
Obamacare. The AlexanderMurray proposal modifies the
law, but doesn’t undo it.
“Right now it’s stalled out,”
Sen. John Thune (R., S.D.) said
of the proposal.
Some GOP aides said the
proposal appeared to give
Democrats much of what they
wanted while giving Republicans less.
Republicans would get
changes that let states receive
speedier and more flexible
waivers from the law’s requirements, as well as the ability of
more people to sign up for lesscomprehensive health plans
with lower premiums. But other
conservative demands weren’t
fordability issues,” said Rick
Notter, an executive at Blue
Cross Blue Shield of Michigan.
The insurer is raising rates on
its ACA health maintenance organization plans by around
23% on average. It predicts the
state’s ACA enrollment will
drop by around 9% next year.
Despite significant rate increases in 2017, enrollment in
ACA plans by subsidized consumers rose an estimated 5.4%
in the second quarter, compared with a year earlier, according to Oliver Wyman, a
unit of Marsh & McLennan.
But enrollment in individual
coverage by people not receiving subsidies dropped 22.4%.
“We will likely see this accelerate in 2018,” said Kurt
Giesa at Oliver Wyman.
Insurers are particularly
nervous about losing healthy
enrollees like Daniel Ramos, a
29-year-old massage therapist
and personal trainer in Richmond, Va.
Mr. Ramos, who says he
rarely needs health care, was
already skeptical about spending around $250 a month for
his current ACA plan from Anthem Inc. Next year, the only
insurer expected to still sell
ACA coverage in Richmond,
Cigna Corp., will boost rates
51% on average across all of its
Virginia exchange offerings.
included, such as a relaxation of
the rules that insurance policies
must cover specific benefits
and cannot charge more to people with pre-existing conditions.
The bill would, as Democrats
wanted, restore federal payments to insurers for two
years. These payments offset
insurers’ costs for providing
subsidies to lower-income consumers, which help with out-ofpocket costs. Mr. Trump has
said he would cut off the payments this month absent legislation authorizing them.
Democrats would also get a
restoration of almost all of the
$116 million in cuts the administration has made in programs that help people sign up
for the law.
Sen. Orrin Hatch (R., Utah),
chairman of the Finance Committee, said he had trouble
with the proposal because he
thought it could cost taxpayers
a lot of money without presenting a long-term solution.
“Look, I appreciate what
they are trying to do,” Mr.
Hatch said. “I just don’t think
CAROLYN KASTER/ASSOCIATED PRESS
BY ARUNA VISWANATHA
AND DEL QUENTIN WILBER
Senate Judiciary Committee members on Wednesday asked
Attorney General Jeff Sessions about the firing of James Comey.
vestigation,” Mr. Sessions said.
The issue of Mr. Comey’s
firing is now under investigation by special counsel Robert
Mueller, who is probing Russian meddling in the 2016 election—which Russia denies—
and related issues.
President Donald Trump
gave shifting explanations of
his decision at the time, initially referring to Mr. Comey’s
handling of the Clinton investigation and later mentioning
the director’s role in the Russia probe.
Mrs. Clinton has cited Mr.
Comey’s public statements
about the case as one of the
“It feels like a big money
hole,” he said.
Insurers fear other factors
could weigh on 2018 exchange
sign-ups, too. The open enrollment period this year will
start on Nov. 1 in most states
and last only about six
weeks—shorter than in previous years. And the Trump administration has cut back on
outreach efforts.
Industry officials also point
to confusion over the status of
ACA after months of talk about
repealing the law.
“It’s all of those things together” that will push down
enrollment, along with “the
sheer size of the rates,” said
Chet Burrell, CareFirst BlueCross BlueShield’s chief executive, who predicts a “decline
that will be quite substantial.”
Despite the uncertainty, insurers say they are focused on
making sure consumers know
when to sign up and understand what is available. For
many people with subsidies,
the rate increases will be
largely neutralized because the
federal help will rise in tandem
with the cost of plans. Those
who don’t get subsidies may
find rate jumps are far sharper
on middle-tier “silver” plans,
but less for other types, because of how insurers in some
states loaded their increases.
A proposal to shore up the Affordable Care Act would restore payments to insurers for two years.
Senators Press Sessions on FBI Firing
Attorney General Jeff Sessions defended his role in the
firing of James Comey as FBI
director, making some of his
fullest remarks on the issue to
date on Wednesday in a Senate
hearing dominated by questions related to Russia but also
touching on immigration, civil
rights and other issues.
Speaking before the Senate
Judiciary Committee for five
hours, Mr. Sessions cited Mr.
Comey’s 2016 public comments that he wasn’t recommending charges related to
Democratic presidential nominee Hillary Clinton’s email use,
describing the remarks as a
monumental mistake.
“I don’t think it has been
fully understood, the significance of the error that Mr.
Comey made on the Clinton
matter,” Mr. Sessions said, responding to questions from
Sen. Dianne Feinstein of California, the panel’s top Democrat. While Justice Department
prosecutors usually announce
decisions on investigations,
Mr. Comey did so himself in
the Clinton investigation.
“For the first time I’m
aware of in all of my experience…the investigative agency
announced a closure of an in-
cheaper non-ACA products with
fewer benefits, the open enrollment season may offer a
chance to snag customers.
“We expect a continued acceleration in demand,” said
Gavin Southwell, CEO of Health
Insurance Innovations Inc.,
which sells short-term plans.
Such products often are
sold only to people who qualify
as healthy. The plans lack certain benefits such as maternity
care, and don’t cover pre-existing conditions. Under current
rules, they can’t be sold with
durations longer than three
months, though that will likely
stretch to nearly a year in many
states under changes pushed
by President Donald Trump’s
executive order last week.
—Anna Wilde Mathews
NIKKI FOX/DAILY NEWS-RECORD/ASSOCIATED PRESS
With enrollment for 2018
Affordable Care Act health-insurance plans starting in just
two weeks, insurers are bracing for a drop-off among consumers put off by higher rates,
confusion about the law’s
standing and a shorter window
to choose coverage.
Companies like Blue Cross
Blue Shield of Michigan, Florida Blue and Medica are rushing to shore up their customer
bases as the future of the 2010
health law continues to be debated at the White House and
on Capitol Hill. The insurers
are using advertising, letters,
emails and other outreach
techniques to reassure enrollees about their insurance options under the ACA in 2018.
Other industry players, including online insurance vendor eHealth Inc., see an opening to offer consumers cheaper
alternatives to ACA policies.
While less comprehensive,
these plans could become
more appealing if the Trump
administration moves forward
with loosening some restrictions on them, as President
Donald Trump proposed in an
executive order last week.
The Trump administration
also said it would halt pay-
states including Iowa, Nebraska
and Wisconsin, is sending letters to people who will automatically be signed up for its
plans. It is also setting up a
special website to help them
pick the best option.
Florida Blue, meanwhile, has
created new, lower-cost plans
at the cheapest ACA bronze
level to appeal to people who
don’t get subsidies, said Jon Urbanek, a senior vice president
at the insurer. The insurer is
also sending postcards to
prompt people to shop during
open enrollment, and is holding
events around the state. “People are seeing all kinds of confusing messages out there,” Mr.
Urbanek said, so the insurer is
trying to reassure them.
For companies that provide
reasons she lost the presidential election. Mr. Trump has
maintained that Mr. Comey’s
actions helped Mrs. Clinton,
tweeting Wednesday morning
that Mr. Comey “totally protected Hillary Clinton. He was
the best thing that ever happened to her!”
At Wednesday’s hearing,
Democrats pressed Mr. Sessions about Mr. Comey’s firing,
and lawmakers from both parties asked about efforts to
combat any future election
meddling by Russia.
“Do you think we’re doing
enough to prepare for future
interference?” asked Nebraska
Republican Sen. Ben Sasse, to
which Mr. Sessions responded:
“Probably not, we’re not.” He
added, “The matter is so complex that most of us, we’re not
able to fully grasp the technical dangers that are out
there.”
Mr. Sessions declined to
discuss any conversations he
has had with Mr. Trump, including about Mr. Comey’s firing. He did say he hasn’t been
interviewed by Mr. Mueller.
Democrats urged Mr. Sessions before the hearing to be
prepared to recount some of
his conversations with Mr.
Trump, and some of the most
heated exchanges came as
Democrats questioned the attorney general about Mr.
Trump’s reasons for firing Mr.
Comey and whether he had
provided cover for the president’s action.
“My concern is you were
part of the Russian facade and
went along with it, and I’ve
known you for years. I’m sorry
you would do that,” said Sen.
Patrick Leahy (D., Vt.), referring to Mr. Sessions’ time as a
senator from Alabama who
served on the Senate Judiciary
Committee.
“It hurt me to hear you say
you think I’m part of a facade.
I’m not part of a facade,” Mr.
Sessions said.
it’s the way to do it because it
would last two years and spend
a whopping amount of money
and not solve the problem and
lead us down a path of never
getting the problem done.”
Mr. Trump’s posture touched
off behind-the-scenes talks
among Senate Republicans over
what changes they could make
to secure the president’s backing. Democrats, however, would
be unlikely to support new demands that erode the law’s current consumer protections.
Any deal would require 60
votes to pass in the Senate,
where Republicans hold 52
seats. Senior Republicans and
aides said they held out hope
they could bring Mr. Trump
around if he could confidently
say the bill wouldn’t benefit insurance companies.
“Both Senator Murray and I
completely agree that we want
the money to go to consumers,
not to insurance companies,”
Mr. Alexander said. The bill
“already says that. It has very
strong language to do that,”
Mr. Alexander said, adding
that he had discussed that
point with Mr. Trump.
The bill’s backers said it
specifies that insurance companies wouldn’t be able to “double
dip” and receive the subsidies
without lowering any premiums
that had been raised in expectation that the subsidies would be
cut off. GOP lawmakers are
firming up language to ensure
this doesn’t occur. “The president is in the process of reviewing that and we welcome his
suggestions about how to improve it,” Mr. Alexander said.
Mr. Trump’s lack of support
for the bipartisan deal in its
current form came as a surprise
to some Republican lawmakers,
while others brushed it off.
“It’s kind of like weather in
South Dakota,” Sen. Mike
Rounds (R., S.D.) said. “It’ll
change on a regular basis until
we’re all satisfied.”
—Natalie Andrews
and Rebecca Ballhaus
contributed to this article.
WASHINGTON WIRE
INVESTIGATION
MILITARY
Firm’s Partners Plead Trump Denies Making
Fifth Before Congress Insensitive Remarks
Two partners at a research
firm that compiled a dossier of
unverified and unflattering allegations about President Donald
Trump invoked their constitutional right not to give testimony before a congressional
committee on Wednesday.
Peter Fritsch and Thomas
Catan, partners at the firm Fusion
GPS, were subpoenaed to appear
behind closed doors with the
House Intelligence Committee.
The men declined to answer
any of the committee’s questions, citing their Fifth Amendment constitutional protection
against self-incrimination, a person familiar with the matter
said. The news was reported by
the Daily Caller.
“No American should have to
experience today’s indignity,”
said Joshua Levy, an attorney
representing Fusion GPS. “No
American should be required to
appear before Congress simply
to invoke his constitutional privileges.”
Mr. Levy said that his clients
weren’t averse to cooperating
with congressional investigators
but wouldn’t reveal certain sensitive information about the
firm’s clients.
—Byron Tau
President Donald Trump denied Wednesday that he made insensitive remarks in a phone call
to the widow of a U.S. soldier and
accused a Democratic House
member of making up the claim,
which was supported by a member of the soldier’s family.
Rep. Frederica Wilson (D., Fla.)
said Tuesday that Mr. Trump, a
Republican, had called the widow
of U.S. Army Sgt. La David Johnson, who died in a deadly ambush
in Niger recently, and told the
widow that her husband “knew
what he signed up for…but when
it happens it hurts anyway.”
In comments to ABC 10 in Miami, Ms. Wilson, who has been a
frequent critic of the president,
called the remarks “so insensitive.
He should not have said that.”
Mr. Trump responded on Twitter Wednesday morning: “Democrat Congresswoman totally fabricated what I said to the wife of a
soldier who died in action (and I
have proof). Sad!”
The soldier’s mother, Cowanda
Jones-Johnson, in an interview with
the Washington Post Wednesday,
backed up Ms. Wilson’s account.
“President Trump did disrespect my
son and my daughter and also me
and my husband,” she said.
—Rebecca Ballhaus
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
* *
Thursday, October 19, 2017 | A5
FROM PAGE ONE
Bull Market Paints
Itself Into a Corner
With 51 record highs this
year, it sometimes feels like
the Dow Jones Industrial Average is going through the roof.
On the side of Ralph Acampora’s barn, it actually is.
Mr. Acampora, a market
strategist for more than four
decades on Wall Street before
he moved to a Minnesota farm
seven years ago, started this
past spring on a 70-foot-long,
16-foot-high painting showing
a chart of the Dow on the side
of the corrugated structure.
When he began painting, the
Dow was busting through
21000 for the first time, a milestone that prompted many analysts to question how much farther the rally could go. But now
that the index has closed above
23000, Mr. Acampora’s rendering has reached the top of the
wall. He has run out of room.
It is another sign of this supercharged stock market that
even someone with Mr.
DOW
Continued from Page One
about news out of Washington,
D.C., North Korea and natural
disasters.
That worry makes Mr. Davidson feel more confident
about the market’s climb.
“The skepticism is healthy.
There’s not a lot of euphoria
out there, and that’s good for
the further advancement of
the market,” he said.
On Wednesday, the Dow industrials barreled past 23000
in the first minutes of trading,
lifted by a jump in shares of
International Business Machines Corp. IBM was the biggest gainer in the Dow, adding
89 points to the average, after
it reported gains in its hardware and artificial-intelligence
divisions despite its 22nd consecutive quarter of year-toyear revenue declines.
Acampora’s pedigree underestimated how far and how fast
it would climb.
The 76-year-old analyst
made a name for himself over
the past 50 years as a technical analyst, studying charts to
predict where shares are
headed next. For much of his
career, he would draw his
stock charts by hand.
Then came the move to
Minnesota. “I had this big
blank wall on the side of the
barn and I had this idea,” he
said. “This chart was inside
me. It had to come out.”
From the time Mr. Acampora started on Wall Street in
1967, each month of trading is
rendered with a thick vertical
black bar on a white background, indicating the month’s
high and low for the index.
“My forecast for the year was
that it would go no higher than
22900,” said a chastened Mr.
Acampora on Wednesday. “I figured we were going to get some
sort of pause at some point.”
Retired analyst Ralph Acampora miscalculated how much room his chart of the Dow’s rise would need on his barn outside Minneapolis.
Robust corporate earnings
and economic data have
helped support stocks, volatility has remained low, and the
prospect of a Republican tax
overhaul has kept some investors hopeful.
“There are some vultures
waiting on the side of the road
for the next downturn so they
can step in,” said Kristina
Hooper, global market strategist at Invesco.
There were slight inflows
into U.S. stock funds in September, according to EPFR’s
monthly figures. Before that,
the last time money flowed in
was March, capping a stretch
of inflows that began the
month of the U.S. election.
The amount of cash in investors’ portfolios remains elevated historically, even though
cash balances slipped to their
lowest level in 2½ years in October, according to a Bank of
America Merrill Lynch survey
of fund managers, which took
into account responses from
179 fund managers with $516
billion in assets.
Stocks’ climb has coincided
with a recovery in U.S. corporate earnings, which slumped
for several quarters before resuming growth in the second
half of last year.
America’s biggest companies are generally projected to
report earnings growth again
for the third quarter, even
though expectations have been
tempered in part because of
the impact of major summer
storms on insurers and other
firms. As of the end of last
month, analysts expected
earnings at S&P 500 companies to rise 4.2% in the third
quarter, according to FactSet.
“Investors continue to say
there is a pretty positive story
in terms of earnings growth,”
said Ron Temple, head of U.S.
equities at Lazard Asset Management.
Company stock repurchases
STEPHEN MATUREN FOR THE WALL STREET JOURNAL
BY ERIK HOLM
have helped support share
prices, some analysts say. In
the second quarter, companies
in the S&P 500 bought back
$120 billion worth of stock, according to data from S&P Dow
Jones Indices. Many analysts
expect share repurchases
among S&P 500 companies
Stocks’ climb has
coincided with a
recovery in U.S.
corporate earnings.
continued at a similar pace in
the third quarter, though data
aren’t yet available. Buybacks
can lift stock prices because
they can decrease the number
of shares available in the market, though some investors say
they would rather companies
spend that money on business
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development and expansion.
Yield-seekers outside the
U.S. also could account for
some of the stock market’s
gains.
Foreign investors have put
roughly a net $40 billion into
U.S. stocks so far this year
through August, compared
with more than $3.5 billion in
net outflows last year, according to Deutsche Bank Global
Markets Research.
The expectation that interest rates would rise slowly in
the U.S. “is an important reason behind why we’ve seen an
increase in allocation from foreigners,” said Torsten Slok,
chief international economist
at Deutsche Bank.
The Federal Reserve has
been gradually raising shortterm interest rates since late
2015, and the central bank signaled that it is considering another increase in December.
Interest rates have been ultralow in developed economies
around the world since the financial crisis.
State-owned
investment
funds have snapped up U.S. equities. In 2017 through the end
of August, about $5.1 billion in
money directly from sovereign-wealth funds has flowed
into U.S. stocks, according to
data from the Sovereign
Wealth Fund Institute. The
data don’t include money allocated to external fund managers, who in turn could invest
in stocks.
Few analysts and investors
see an imminent end to the
rally that has taken the Dow
industrials to several milestones since the election. The
Dow advanced from 20000 to
21000 in just 24 trading days
in March, tied for the fastest
thousand-point gain in the index’s history. The blue-chip index has finished the final calendar quarter higher than the
previous quarter seven of the
past eight years.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A6 | Thursday, October 19, 2017
* ****
THE WALL STREET JOURNAL.
WORLD NEWS
Xi Takes the Long View of China’s Future
President promotes
role of Communist
Party in society,
economy at congress
BEIJING—President Xi Jinping signaled his ambition to
shape China far into the future
as he set a new goal potentially achievable within his
own lifetime: to build a modern nation by 2035.
Opening a Communist Party
congress on Wednesday that
will anoint him for a second
five-year term, Mr. Xi boldly
aligned China’s future more
closely with his own reign and
reinforced the expectation that
he intends to remain a force for
years to come.
The Chinese leader staked an
ideological claim to lead the
party and China to a period of
greater power and prosperity,
coining a new catchphrase for
it—“thought[s] on socialism
with Chinese characteristics for
a new era”—which gives him
wide remit to reorient established policies. The top Chinese
leadership hailed the speech.
He also brought forward a
longstanding goal to achieving
“socialist modernization” by
2035 while affirming the goal of
placing China in the front ranks
of nations by 2049.
The 2035 target “certainly
accentuates the growing expectation that Xi has no plans
to retire anytime soon,” said
Jude Blanchette of the Conference Board’s China Center for
Economics and Business, a research group.
Addressing more than 2,300
select party members in Beijing’s Great Hall of the People
for nearly 3½ hours, Mr. Xi indicated that the party would continue to strengthen its grip on
society and the economy, while
projecting power abroad and offering a development model for
other nations.
“This is a new historic juncture in China’s development,”
Mr. Xi said. “It will be an era
that sees China moving closer to
center stage and making greater
contributions to mankind.”
As he spoke, Chinese social
media buzzed with images of
people watching the televised
AGENCE FRANCE-PRESSE/GETTY IMAGES
BY JEREMY PAGE
AND CHUN HAN WONG
College students in Huaibei waved Chinese national flags as they watched the opening of the Communist Party congress in Beijing. President Xi set long-term goals.
China’s Economy
Up Healthy 6.8%
BEIJING—China’s economy
expanded at a robust 6.8% pace
in the third quarter, meeting
market expectations as traditional growth drivers such as
manufacturing and exports
gained steam.
Increased industrial activity
and higher commodity prices
were major reasons behind the
strong growth. The latter, partly
a result of policies to cut overcapacity, benefited state-owned
manufacturers in particular.
That is because the capacity
cuts led to the closures of
many private firms, especially in
industries like coal and metals.
Recovering global demand
also helped, giving China some
economic breathing room,
which has meant an economic
slowdown that many expected
hasn’t materialized.
Industrial production, a main
gauge of manufacturing activity,
rose 6.6% in September from a
year earlier, according to data released Thursday by the National
Bureau of Statistics. Retail sales
jumped 7.3%, though analysts
caution consumption growth is
still trailing wage growth.
—Lingling Wei
speech in places like kindergartens, hospital wards and even a
police-detention center.
The twice-a-decade congress
is expected to promote Mr. Xi’s
protégés and allies and cement
his political supremacy. It could
also lay a path for the 64-yearold to stay in power after his
second term, eroding retirement norms designed to prevent a return to a Mao-style dictatorship.
Among those attending the
congress on Wednesday were
Mr. Xi’s two immediate predecessors—Hu Jintao, 74, and Jiang Zemin, 91—in prominent
front-row seats on the stage
flanking Mr. Xi’s.
Mr. Xi pointedly didn’t refer
to another goal—doubling gross
domestic product between 2010
and 2020—in what some economists saw as an attempt to give
the party greater flexibility in
managing a slowdown.
Mr. Xi reiterated a pledge
to let market forces play a
“decisive” role in the economy
even as he said the state sector should be “stronger, better
and bigger.” He promised to
promote entrepreneurship, but
insisted on the party’s commanding influence over private businesses.
“This reinforces the reality
that China is not on a path of
convergence with Western capitalism,” said Scott Kennedy, a
deputy director at the Washington-based Center for Strategic
and International Studies. “Its
hybrid system is driven by a different, state-socialist logic and
will endure as long as the party
is in power.”
In recent years, Beijing has
stepped back from its promise
to let markets decide winners
and losers, leaning instead on
state intervention to engineer
economic outcomes and enlarging already giant state firms
through mergers.
More than his predecessors,
Mr. Xi used his speech to appeal to the Chinese public and
call on party members to meet
the people’s aspiration “to live
a better life.”
“The party, government, military, society, education, north,
south, east, west—the party
leads everything,” he said.
Christopher Johnson, a former China analyst at the Central
Intelligence Agency, said the
2035 deadline appeared to be
designed to attach an ambitious
goal to Mr. Xi’s new slogan.
“The China dream and national rejuvenation are lofty
concepts but this is an actual
target which pins him down a
little bit,” Mr. Johnson said.
BY FELICIA SCHWARTZ
Secretary of State Rex Tillerson will travel to India next
week to press his view that
the U.S.—not China—represents the South Asia economic
giant’s most reliable partner
for the future, he said in a
speech Wednesday.
Ahead of the trip, his first
to India as chief U.S. diplomat,
Mr. Tillerson said the Trump
administration sees American
and Indian interests converging and that the two democracies are a bulwark against
China’s rise.
“The very international order that has benefited India’s
rise—and that of many others—is increasingly under
strain,” Mr. Tillerson said at
the Center for Strategic and
International Studies, a Washington think tank. “China,
while rising alongside India,
has done so less responsibly,
at times undermining the international, rules-based order—even as countries like India
operate
within
a
framework that protects other
nations’ sovereignty.”
He said Delhi and Washington are united in their commitment to “upholding the
rule of law, freedom of navigation, universal values and free
trade.”
“In this period of uncertainty and angst, India needs a
reliable partner on the world
stage. I want to make clear:
with our shared values and vision for global stability, peace
and prosperity, the United
States is that partner,” Mr. Til-
lerson said.
He said the U.S. seeks constructive ties with China, but
“won’t shrink from China’s
challenges to the rules-based
order, or where China subverts
“We will never seek hegemony or engage in expansion,
never pursue development at
the expenses of others’ interests,” an embassy spokesperson said. “China and the U.S.
are better together. We hope
the U.S. side can work in the
same direction with China to
ensure the healthy and sound
development of the China-U.S.
relationship.”
Beijing routinely criticizes
the U.S. for using alliances to
try to foil Chinese interests.
More broadly, Mr. Tillerson
said, the U.S. and India have
common interests on a number of security challenges, including China’s land-reclamation activities in the South
China Sea, terrorist threats,
cyberattacks and North Korea’s nuclear program.
Delhi ‘needs a
reliable partner on
the world stage,’ says
secretary of state.
the sovereignty of neighboring
countries, and disadvantages
the U.S. and our friends.”
China’s embassy in Washington said Beijing contributes
to and defends a rules-based
world order.
Clinton Criticizes Trump on North Korea
SEOUL—Hillary
Clinton,
who as secretary of state oversaw President Barack Obama’s
policy on North Korea, criticized the Trump administration’s bellicose language toward Pyongyang and warned
that the approach isn’t working on Kim Jong Un.
In a speech at a forum here
on Wednesday, Mrs. Clinton said
the U.S.’s war of words with the
North Korean dictator was damaging American interests.
“Americans as well as Koreans have every right to be concerned about what path we are
heading down,” she said. “Picking fights with Kim Jong Un
just puts a smile on his face.”
President Donald Trump and
Mr. Kim have traded barbs in
recent months, their quarrel
fueled by Pyongyang’s advancing weapons program and
Washington’s warnings of possible military action. Mr. Trump
has referred to Mr. Kim as “little rocket man” and threatened
YONHAP/REUTERS
BY TIMOTHY W. MARTIN
Speaking in Seoul on Wednesday, Hillary Clinton said the U.S.’s
aggressive approach toward Pyongyang is counterproductive.
to “totally destroy” North Korea. Mr. Kim, meanwhile, has labeled the U.S. president a “dotard” and “mentally deranged.”
Under Mr. Obama, Mrs. Clinton advocated for strategic patience toward North Korea, engaging U.S. allies such as Japan
and South Korea and putting
pressure on Pyongyang to return to negotiations. She said
Wednesday that “bluster and
personal taunts” would make it
impossible to achieve that aim.
She singled out China’s role
in diplomatic efforts, saying
Beijing must play a larger role
in ensuring sanctions against
North Korea are enforced.
China moved recently to reduce its oil exports to its
neighbor and cut off imports of
North Korean textiles, among
other measures taken in line
with United Nations sanctions.
Secretary of State Rex Tillerson said this week that the
U.S. would pursue diplomacy
on North Korea “until the first
bomb drops.” Mr. Trump, in
earlier comments, said Mr. Tillerson was wasting his time
with diplomacy and that “only
one thing will work.”
U.S. and South Korean
forces are conducting joint military exercises around the Korean Peninsula this week. The
drills have angered Pyongyang.
TONY KARUMBA/AGENCE FRANCE-PRESSE/GETTY IMAGES
Tillerson Courts India Before Trip
Backers listened to Raila Odinga at a rally in Nairobi Wednesday.
New Doubts Emerge
On Kenya Vote Rerun
BY MATINA STEVIS-GRIDNEFF
NAIROBI, Kenya—The chief
of Kenya’s electoral commission
said he wasn’t able to deliver a
credible election next week
amid meddling from candidates
and threats of violence, casting
further doubt on the vote just
hours after a top electoral official said she had resigned and
said she feared for her life.
The country has been
plunged into political turmoil
since the Supreme Court annulled the August election and
ordered an Oct. 26 redo, saying there were major problems
with the original count.
The planned revote has
strongly divided the country,
with some arguing that the
commission can’t deliver a fair
and trustworthy election as
planned. Roselyn Akombe, one
of eight commissioners, said
she had fled the country for
the U.S. and called on others to
join her in opposing the vote.
In the wake of her announcement, her former boss,
Wafula Chebukati, chief of the
Independent Electoral and
Boundaries Commission, issued
a warning to the country’s political leaders on Wednesday.
“It’s impossible under the
current conditions to hold free
and fair elections,” Mr. Chebukati said in a news conference.
“I issue a stern warning to both
sides to stop interfering with
the work of the commission.”
In a tweet from his verified
official account, Deputy President William Ruto said in response, “Chebukati should
stop lecturing us and oversee
the elections. He is not doing
us & we need no favours.”
Incumbent Uhuru Kenyatta
was named the winner of the
Aug. 8 election, but the Supreme Court backed a petition
by opposition leader Raila
Odinga to annul it. The court’s
ruling said the electoral commission was to blame for irregularities in the documentation
and transmission of the results.
Mr. Odinga this month said
he wouldn’t run in the new
poll because he didn’t think
the vote would be fair and has
called for nationwide protests.
His supporters have clashed
with Kenyan riot forces in recent weeks. At least three protesters have been killed in Kisumu,
an
opposition
stronghold, over the past
week.
Kenya’s interior ministry
and police say any abuse of
power by the police will be investigated but that force is
generally proportional, as
some protesters are armed.
Mr. Odinga declined to
comment on Ms. Akombe’s
claims, saying it was “a subject for another day.”
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THE WALL STREET JOURNAL.
* *
Thursday, October 19, 2017 | A7
WORLD NEWS
BY VALENTINA POP
BRUSSELS—The European
Union called on its member
states to better secure public
spaces from terrorist attacks
and design them with the
threat in mind, after deadly
assaults that have hit crowded
urban areas in recent years.
The European Commission
said it would provide more
than €100 million ($118 million) through the middle of
next year for cross-border
projects and cities investing in
the protection of so-called soft
targets: public spaces with a
high concentration of people.
Terrorists in recent years
have increasingly targeted pedestrian areas, concert halls,
airports and Christmas markets in European cities such as
Barcelona, Berlin, London,
Paris and Nice by using hijacked cars and trucks, and in
some cases weapons and explosives.
“We have to accept that the
terrorists don’t stand still,
they change and adapt their
methods. We need to adapt
our response,” said European
security commissioner Julian
King.
He said the commission will
enable local authorities, urban
planners and security experts
to meet and exchange best
practices on how to “make
public spaces safer without
denaturing them.”
Over the past four years,
the EU has funded 48 securityresearch projects related to
the protection of public
spaces, costing €195 million,
involving technology for securing urban transport and
surveillance-camera systems.
The commission said countries should consider security
issues from the outset of any
design, for instance by fitting
new buildings with accesscontrol zones.
Detailed recommendations
are to be put forward by the
commission in coming months
on how to mitigate the risk of
trucks being hijacked and used
by terrorists to plow into
crowds.
Tighter rules for the detection of drones potentially used
by terrorists are also in the
works, the commission said.
The commission made a series of proposals on how national governments can restrict the access to materials
that can be used in making
bombs, notably TATP, a homemade explosive.
It said governments should
carry out background checks
on the buyers of restricted
chemical substances and step
up inspections of shops selling
them.
ISIS Faces Cash-Strapped Future
BY MARIA ABI-HABIB
Once the wealthiest terror
group in the world, Islamic
State is losing lucrative sources
of income and its ability to recruit fighters along with the
territory in Iraq and Syria that
is rapidly slipping from its grip.
Islamic State’s self-declared
caliphate catapulted them to a
success no other jihadist group
had ever seen. In 2014, the extremists ruled an area the size
of Belgium and presided over
some eight million civilians
from whom it extorted money
and collected taxes and fees
for basic services.
Now that the extremist
fighters have been defeated in
their de facto capital of Raqqa,
which fell to U.S.-backed forces
in Syria on Tuesday, the group
is likely to try to become a
more traditional hit-and-run
insurgency. That means that it
will no longer be able to generate revenue in the same ways,
or to tout an ambitious, statebuilding project that its supporters found so appealing and
that set it apart from other jihadist groups.
“The group’s financial empire has been systematically
dismantled by the U.S.-led coalition, exacting a heavy toll on
its ability to pay the salaries of
its fighters and the costs of
providing minimal services,
even basic food, to the inhabitants under its rule,” said
Fawaz Gerges, a professor of
international relations at the
London School of Economics.
“ISIS’s aura of invincibility
and legitimacy, resulting from
its earlier military success, appears to be shattered beyond
repair,” he said.
In addition to extortion and
tax collection, Islamic State
had also generated income by
ERIK DE CASTRO/REUTERS
EU Urges
Protection
For Public
Spaces
A Syrian Democratic Forces fighter inspects a room under the stadium in Raqqa that Islamic State militants used as a jail cell.
selling oil from fields it controlled in Iraq and Syria, taking in some $500 million in
2015 alone, according to U.S.
Treasury estimates at the
time. The extremists also
made money from kidnapping,
but that wasn’t as large a revenue stream, according to U.S.
officials monitoring the group.
But only a relative handful of
people live in areas Islamic
State still holds. In addition to
losing Raqqa and Mosul in Iraq,
it is also losing ground in
Syria’s Deir Ezzour province,
home to the most important oil
fields the group controlled. In
Iraq, the group lost control over
an oil field in Qayara about a
year ago, its last significant energy resource in the country.
As a result, Islamic State
will face a more cash-strapped
future, facing the problems
other jihadist groups have
seeking donations, which have
largely been cut off through
counterterror measures led by
the U.S. and its allies.
The group’s inability to administer a caliphate, or religious empire, will also make it
harder to attract new followers.
The military prowess of Islamic State’s blitz across
liph—a religious ruler considered a successor to the Prophet
Muhammad—it was a grand
proclamation that excited supporters. Without a physical caliphate, Mr. Baghdadi’s status
could soon be in question.
“The notion of the caliphate
was central to ISIS’ appeal,”
said Peter Neumann, director
of the International Center for
the Study of Radicalization at
King’s College in London. “To
me, it seems logical that its
destruction will have an impact on recruitment as well.”
—Nour Alakraa
contributed to this article.
As Iraqi Forces Consolidate Control, Kurds Flee
BY ISABEL COLES
AND ALI A. NABHAN
KIRKUK, Iraq—Thousands
of Kurdish civilians fled their
homes in northern Iraq on
Wednesday, fearing harassment by government forces
and Shiite militias who have
taken control of a vast swath
of territory from Kurdish
fighters.
Cars clogged checkpoints
along the main road out of Kirkuk as Kurdish residents
rushed to leave, days after Iraqi
forces entered it to reimpose
federal government authority.
The city had been under full
Kurdish control since 2014.
Prime Minister Haider alAbadi, emboldened by a series
of victories against Islamic
State, ordered Iraqi forces into
Kirkuk on Monday. The army
faced little resistance from
Kurdish Peshmerga fighters,
who fled and have since surren-
dered much of the territory
outside the boundaries of the
Kurds’ semiautonomous region.
South of Kirkuk, the entire
Kurdish population of Tuz
Khurmato fled the town when
Peshmerga forces protecting
them retreated, and local Turkmen—many of whom belong to
government-backed Shiite paramilitary groups—ransacked and
torched their homes, local residents and officials said.
The reported violence and
exodus show how shifts in
power in northern Iraq can
lead to demographic movements that threaten to unleash
new conflicts between the diverse ethnic groups in the disputed territories.
Many Arabs, Turkmen and
other constituencies that resented Kurdish dominance rejoiced at the return of Iraqi
forces and feel newly empowered by the re-imposition of
federal government authority.
But for Kurds, who have enjoyed increasing dominance in
Kirkuk and other disputed territories since the overthrow of
Saddam Hussein in 2003, the
new reality marks a dramatic
reversal of fortunes that recalls painful chapters of perse-
Prime minister calls
for calm, but Kurds
don’t trust the
Baghdad government.
cution in their history.
Although Mr. Abadi has
called for restraint, Kurds
don’t trust the Iraqi government, especially allied paramilitary groups, some of which
are backed by Iran and have
been implicated in abuses
against civilians in areas they
Merkel Begins Talks to Form Ruling Bloc
FILIP SINGER/EPA/SHUTTERSTOCK
BY ANDREA THOMAS
BERLIN—Chancellor Angela
Merkel kicked off talks on
forming Germany’s first threeparty ruling majority in parliament, a process fraught with
pitfalls that threatens to
stretch into next year.
Following a disappointing
performance in last month’s
election that left her centerright bloc in first place but politically weakened, Ms. Merkel
will seek to coax a joint government agenda from three
parties that hold often contradictory political views. And
she will have to do so in the
coming weeks without losing
the backing of conservatives
in her own camp who are still
smarting from her party’s disappointing victory.
The talks bring together Ms.
Merkel’s center-right movement—the Christian Democratic
Union and its Bavarian sister
party the Christian Social
Union—the pro-business, euroskeptic Free Democratic Party,
and the liberal, environmentalist Greens, who have never ruled
together at the federal level.
Senior officials from the
conservatives and the Free
Democrats stressed the constructive atmosphere of their
first meeting. The main stumbling block will be bridging differences between the Christian
Social Union and the Greens.
“This will be the biggest
and toughest nut to crack,”
said the CSU’s party general
swaths of the Middle East in
2014 propelled the militants to
fame among many jihadists, as
did the image the group promoted online of a utopian religious empire where children
were given juice and popcorn
on the streets while no crime
went unpunished.
But activists who challenged Islamic State’s propaganda exposed the brutal reality of the extremists’ rule.
Losing on the battlefield is another significant blow.
When Islamic State leader
Abu Bakr al-Baghdadi in July
2014 declared himself the ca-
Chancellor Angela Merkel, second from left, Green party head Cem Özdemir, right, and other party
figures Wednesday at the parliament building in Berlin. The parties are divided on a range of issues.
Andreas Scheuer. “But I believe if everyone assesses the
realities in this country correctly then it’s possible for us
to take a big step up the ladder this week.”
The Greens’ secretary-general Michael Kellner said after
his party’s meeting with the
conservatives that all sides
looked for solutions to achieve
cohesion in Germany, but “it’s
clear that we have still quite
some way to go.”
The parties have more policy gaps than overlaps on issues ranging from immigration policy to the scope of
planned tax cuts, Germany’s
posture toward Russia, and
how to respond to the diesel
emission scandal that has cast
uncertainty over the country’s
mighty car industry.
Ms. Merkel may find her
most awkward negotiating partners to be her own allies. The
Bavarian CSU, which faces a regional election next year after a
historically poor showing in last
month’s election, is under pressure to show its voters it can
deliver on its calls for tougher
immigration rules, which the
Greens in particular oppose.
After a preliminary CDUCSU deal, the conservatives
will aim to keep the yearly in-
flux of asylum seekers below
200,000 and ease deportation
of failed applicants.
The Greens insist on phasing out coal-power plants,
which the other parties think
could make already expensive
electricity even dearer.
The Free Democrats want
roughly €30 billion ($35.3 billion) in tax cuts, twice what
the conservatives and Greens
have said they can accept. Like
the CDU but unlike the Greens,
the FDP is opposed to more
fiscal burden-sharing between
members of the euro currency
union as suggested by French
President Emmanuel Macron.
retook from Islamic State. Militia leaders have made hostile
statements against Kurdish
leaders and Kurdish media has
fueled the fear.
Mr. Abadi said local police
and the elite counterterrorism
service were in control of the
city, and ordered them to prevent any other armed groups
from operating there—an apparent reference to the mainly
Shiite paramilitary groups.
Only three weeks ago, the
Kurds held a referendum on independence from Iraq, including Kirkuk and other disputed
territories they had seized
since Islamic State’s onslaught
in 2014. In the weeks before
the vote, critics warned the
referendum would jeopardize
those gains. But the Kurdish
leadership pressed ahead, saying it would provide a mandate
to negotiate an amicable separation from Baghdad over the
coming years. That calculation
backfired, prompting Mr. Abadi
to move on the Kurds.
Security officials said there
had been isolated incidents
against Kurds and their property in the chaos that followed
the city’s changing hands.
Kurds fleeing the city, however, said they felt threatened,
particularly by the paramilitary units now in the city.
In Kirkuk, mosque loudspeakers were used to urge
people not to leave. On the
main road out of the city, Iraqi
forces blocked the way with
armored vehicles, holding back
hundreds of cars and seeking
to reassure those fleeing.
Many were leaving for the
second time in days: having
fled as Iraqi forces pushed toward Kirkuk, they returned to
the city only to leave again as
word spread of threats to
Kurds. “We won’t come back
until it’s safe,” said 24-yearold cameraman Aryan Salar.
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A8 | Thursday, October 19, 2017
THE WALL STREET JOURNAL.
* *
WORLD NEWS
India Ponders Its ‘Smart City’
New state capital’s planners to use drones, AI to keep order, stop slum growth
BY DANIEL STACEY
The decision to extend negotiations over the North
American Free Trade Agreement into the spring will inject trade into the middle of
By William Mauldin
in Washington
and Dudley Althaus
in Mexico City
PRARTHNA SINGH FOR THE WALL STREET JOURNAL; SURBANA JURONG (TOP)
AMARAVATI, India—The
government planners now
dreaming up India’s first
“smart city” realize they
have a problem.
To solve it, they are planning to dispatch a fleet of
drones, bury the power grid
and link a biometric database to every square foot of
land here in India’s newest
state capital.
The problem is that none
of India’s modern-day
planned cities have lived up
to their hype. Instead, they
have succumbed to slums,
crowding and chaos.
Amaravati was named the
new capital of Andhra
Pradesh after the Telangana
region broke away as a new
state in 2014. Since then, $1
billion in loan pledges from
the World Bank and Asia Infrastructure Investment Bank,
alongside an additional $2.3
billion from state and federal
government agencies, have
breathed life into the project.
Planners envision a city of
3.5 million people on land
currently home to 100,000
farmers and rural laborers
living in 29 villages.
Farmers are exchanging
their land for smaller, more
valuable plots in the new city.
Poorer farmhands who don’t
own land have been promised
a place in new government
housing. For low-income business owners, government developers plan to offer “microplots” as small as 50 square
meters for $3,000 and up.
Two of Singapore’s largest
developers, Ascendas-Singbridge and Sembcorp Industries, have signed on to build
the city’s commercial district, while British architects
Foster + Partners are designing a sprawling government
complex to spread over 2
square miles.
Prime Minister Narendra
Modi has pledged to build or
redevelop 100 “smart cities”
in coming years, sparking a
Trade-Talks Shift
Complicates 2018
Political Contests
An image of the future ‘smart city’ of Amaravati, above. The site of a planned road, below.
wave of interest from offshore developers, and skepticism from those who view
the plans as unrealistic.
Mr. Modi and other leaders are striving to avoid the
mistakes of past grand urban-development plans. In
Navi Mumbai, a satellite city
of 1.1 million next to financial
capital Mumbai, the latest
national census determined
that around one of every five
residents now lives in a slum.
Gurugram, a new city previously known as Gurgaon
south of the capital Delhi, is
likewise dotted with slums
and struggles to provide services such as sewerage, water, drainage and firefighting.
Efforts to provide such
services to slum residents
have left many cities financially crippled.
Amaravati, its planners in
the state development agency
say, will be different. They insist that technology will help
the city run more efficiently
and allow them to impose
rules and order on growing
populations in ways that haven’t yet been possible.
“This is a highly futuristic
city; India’s second growth
story will start from Amaravati,” said Sreedhar Cherukuri, the commissioner in
charge of Andhra Pradesh’s
state development agency.
Every contingency has been
thought of, state planners say.
They aim to deploy drones to
spot new slums popping up
within the sprawling parks it
The Face
of Change
plans, allowing authorities to
quickly clear them.
Every property owner will
have their fingerprints and
iris scans from a new national database linked to
land records. Residents will
pay property tax and utility
bills using bank accounts
and mobile apps linked to
the database.
An underground power
grid with smart meters that
identify spikes in usage will
make it impossible for
poachers to steal electricity.
Buses and trams will be
largely self-driving.
The visionary behind this
new city is N. Chandrababu
Naidu, the state’s chief minister. He helped transform the
state’s previous capital, Hyderabad, into a high-tech hub.
Mr. Naidu said he believes
Amaravati can emulate prosperous modern cities in China,
Japan and Southeast Asia, and
at age 67 he is staking his legacy on making it work. “I’m
confident,” he told The Wall
Street Journal. “People will
associate it with me totally.
Amaravati means Naidu.”
political campaigns in the U.S.
and Mexico next year, and
may complicate efforts to sign
and ratify a new version of
the pact.
The U.S., Canada and Mexico said Tuesday they would
take a longer-than-expected
pause in the talks and allow
negotiations to run through
the first quarter of 2018, extending a previous goal of
wrapping up a deal around the
end of this year.
The Trump administration
has proposed several provisions that would weaken
Nafta, generating opposition
from the U.S. business community and Canadian and Mexican officials, but support from
labor leaders.
Those lines are expected to
harden in next year’s campaigns, pitting those, like President Donald Trump, who
blame trade pacts for the loss
of jobs in the U.S., against wellfunded, business-backed candidates who support free trade
and will point to ways that it
benefits their constituents.
The talks have already inflamed politics in Mexico,
which has presidential and
congressional elections next
year. A leftist candidate, Andrés Manuel López Obrador, is
seeking to succeed President
Enrique Peña Nieto and has
called for Nafta to be renegotiated by whoever wins next
summer’s vote.
Canada’s Liberal government, led by Prime Minister
Justin Trudeau, faces no im-
mediate political risks from
the delay as it doesn’t face reelection until 2019.
In the U.S., the 2016 presidential and congressional
races showed just how potent
trade can be as a campaign issue. Then-candidate Trump
made opposition to Nafta a
centerpiece of his campaign,
calling the pact a disaster and
insisting he would withdraw
from it or renegotiate it. He
also opposed the Trans-Pacific
Partnership, a deal negotiated
under Barack Obama. Hillary
Clinton went against her
party’s incumbent in opposing
the TPP.
A deal in March would require lawmakers facing reelection to make a quick decision about whether to support
Candidates in U.S.
and Mexico would
have to make a quick
call on a Nafta deal.
Mr. Trump’s brand of trade
policy—closer to that of
unions and many Democrats—
or more-traditional free-trade
policies backed by most Republican lawmakers, business
groups and a smaller group of
Democrats. Congress would
have to ratify any renegotiated agreement, assuming
there is one.
“The later this deal gets
pushed into the election year,
the more complicated it gets
for politicians,” said Scott
Reed, senior political strategist at the U.S. Chamber of
Commerce.
“Congress does not want to
deal with this in an election
season,” he said.
—Paul Vieira in Ottawa
contributed to this article.
Stanley Wise
Customer Experience
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THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | A9
* *
WORLD NEWS
Venezuela Opposition at Odds After Rout
Rare antigovernment
victors boycott
swearing-in, risk being
barred from office
CARACAS,
Venezuela—
Newly elected opposition governors refused to take their
oaths of office before a progovernment assembly Wednesday, setting the stage for a
showdown that threatens to
further weaken the demoralized coalition opposed to President Nicolás Maduro.
The five antigovernment
figures among the 23 winners
of Sunday’s regional elections
boycotted a swearing-in ceremony at the Constituent Assembly, a superbody packed
with Mr. Maduro’s supporters
that the opposition and dozens of foreign governments
consider unconstitutional.
Mr. Maduro has said failure
to attend the ceremony would
mean the governors-elect
couldn’t take office. And rulingparty officials in states the opposition won said they were
ready to take over the governor’s office in case of a boycott.
A
disastrous
showing
in Sunday’s vote, with the government winning 18 of 23
MARCO BELLO/REUTERS
BY ANATOLY KURMANAEV
Héctor Rodríguez, the pro-Maduro governor of Miranda state, was sworn in before the Constituent Assembly in Caracas on Wednesday.
states when polls predicted the
opposite would happen, has
left the opposition coalition
debilitated and in disarray.
In the wake of the election,
breaches developed among key
opposition figures. Some leaders of the Democratic Unity alliance claimed fraud delivered
the win to the government.
Others attributed the loss to
abstention by opposition voters or blamed the coalition for
participating at all.
Whatever the cause, the
ruling Socialist Party’s lopsided victory Sunday appeared
to be undoing the decade-old
alliance, which has been riven
with public discord this week.
“The results were clearly a
disaster for the opposition and
indicate that a new approach is
going to be needed if they have
a chance to change the direction of Venezuela,” said Eric
Farnsworth, vice president of
the Council of the Americas
and Americas Society.
The aftermath has left opposition leaders with few options, all of them unpalatable.
Taking the oath in front of
the Constituent Assembly
would have further weakened
the claim of government foes
that that body is an illegal entity whose very existence has
turned Venezuela into a dictatorship. Boycotting, though,
will likely mean handing the
ruling party a virtual monopoly on elected offices.
“Democratic Unity got to
this stage because of its own
errors, before and after the
elections,” said opposition
leader Henri Falcón, who lost
his re-election bid for governor of Lara state. “Without a
deep internal evaluation and
self-criticism, the alliance
won’t regain people’s support.”
It wasn’t supposed to end
this way. A range of polls
showed the opposition would
handily win, in some places by
a 2-to-1 margin, as long as
60% of the electorate showed
up to vote. More than 60% did,
according to the electoral
board, but the outcome went
the government’s way.
After four months of seemingly futile protests that cost
120 lives, the opposition had
hoped a big win Sunday would
give it leverage to pressure
the government to schedule
presidential elections in 2018.
Instead, the elections have
sapped the opposition’s remaining political capital.
“I don’t want to hear about
the opposition ever again,”
said Joysf Bueno, a homemaker
from the Caracas suburb of
Guatire who voted for Democratic Unity on Sunday. “I feel
betrayed because they asked us
for support and then let themselves be swindled of votes.”
—Ryan Dube
contributed to this article.
BRAZIL
Ex-Olympics Official
Charged With Crimes
Prosecutors filed criminal
charges against the former president of the country’s Olympic
committee for his alleged involvement in a vote-buying ring
meant to secure Rio de Janeiro’s
application to host the 2016
Games.
Carlos Nuzman and five others, including Sérgio Cabral, the
former governor of Rio de Janeiro, were charged with corruption, conspiracy, money laundering and capital evasion.
A lawyer for Mr. Nuzman said
Wednesday that the former
Olympic official denies any
wrongdoing. A lawyer for Mr.
Cabral, who had been sentenced
in June to 14 years in prison on
charges related to the country’s
Car Wash corruption investigation, said the former governor
denied wrongdoing.
The prosecutors allege that
Mr. Nuzman and a former deputy brokered the payment of
bribes to undecided International
Olympic Committee members
ahead of a 2009 vote on what
city would host the 2016 Olympics.
Mr. Nuzman, who presided
over the opening ceremony of
the 2016 Games, was arrested
in his Rio home at the beginning
of October and last week resigned from the helm of Brazil’s
Olympic committee.
The charges against him and
others in this case still need to
be accepted by a judge for them
to face trial for those alleged
crimes. —Luciana Magalhães
CANADA
Manufacturing Sales
Shot Up in August
Manufacturing sales rebounded in August with a sharp
gain, defying market expectations for a third straight
monthly decline, on strong auto
demand and higher energy
prices.
Factory sales rose 1.6% in August on a seasonally adjusted
basis to 53.53 billion Canadian
dollars (US$42.66 billion) from
July, Statistics Canada reported
on Wednesday.
The result far exceeded expectations among traders for a
0.3% decrease in August sales,
according to economists at
Royal Bank of Canada.
On a volume, or price-adjusted basis, manufacturing sales
rose 1.2%.
—Paul Vieira
ETIENNE LAURENT/EPA/SHUTTERSTOCK
WORLD WATCH
ART OUTSIDE: A sculpture titled ‘Statues Die Too’ by German
artist Stefan Rinck is displayed in the Tuileries Garden in Paris.
FROM PAGE ONE
Continued from Page One
“two planes were used on limited occasions for businesscritical or security purposes.”
Mr. Immelt didn’t respond to
requests for comment.
When Mr. Flannery took
over on Aug. 1, one of his first
belt-tightening moves was to
ground GE’s entire fleet of six
business jets, and that’s just
the beginning.
Next month, Mr. Flannery is
expected to unveil results of a
strategic review that includes
thousands of corporate-level
job cuts and scaling back of
GE’s global structure, people
familiar with the matter said.
The new CEO is shutting
down research centers in
Shanghai, Munich and Rio de
Janeiro, shifting some of their
engineering work into individual business units, the
people said. The retrenchment will leave GE, which
spent more than $5 billion on
research and development
last year, with two global research sites.
Asked about the looming
changes, the GE spokeswoman said: “The company
will continue to have an intense focus on our global operations and customer base,”
noting that the company gets
70% of its revenue from outside the U.S.
The company is expected to
report quarterly results on
Friday that include hefty restructuring charges related to
the changes.
Mr. Flannery, a GE lifer who
is 56 years old, made clear
when he was named Mr. Immelt’s successor that he was
open to wrenching changes.
Some of the restructuring
moves under way suggest the
company could be in worse
shape than many outsiders
previously thought.
Investors are bracing for
the Boston company to cut
profit forecasts and possibly
reduce its dividend, despite
promises by GE that the payout is safe. “The dividend remains a top priority,” the GE
spokeswoman said.
Mr. Flannery has told people there are “no sacred cows”
in his strategic review. GE has
Losing Value
THE PLEDGE
GE's stock-market value fell by about half when Jeff Immelt was CEO.
Immelt’s tenure as CEO
$600 billion
Recession
500
400
300
200
100
0
2000 ’02
’04
’06
Source: Thomson Reuters DataStream
operations in more than 180
countries and is one of the
biggest makers of jet engines,
power-plant turbines and MRI
machines. He made a similar
vow several years ago when he
led the deal-making team that
moved to shrink GE Capital
and sell GE Appliances.
“Good intentions and hard
work count for something—
but in the end the only real
scorecard is what were the results of all that,” he wrote in a
letter to employees on his first
day as CEO.
In March, Mr. Immelt
pledged to cut $2 billion from
the company’s annual indus-
GE is trying to end a
stock-price slide that
includes a fall of more
than 25% this year.
trial expenses over two years,
while tying part of executive
bonuses to that target. It was
a concession to activist investor Trian Fund Management
LP, which bought a large stake
in GE in 2015 and grew frustrated with the company’s
turnaround progress.
Until his departure, Mr. Immelt continued to invest in
marketing and digital efforts,
hiring thousands of software
programmers in recent years.
He announced plans to relocate GE’s headquarters to Boston from Fairfield, Conn.
After taking over, Mr. Flannery delayed part of the headquarters project, a futuristic,
12-story glass tower with a
’08
’10
’12
’14
’16
THE WALL STREET JOURNAL.
veil of solar panels on its roof.
Earlier this month, he agreed
to give a Trian executive one
of GE’s board seats rather than
risk losing a proxy fight.
Trian’s
representative
hasn’t attended a board meeting yet, and Trian has had no
direct say in the moves by the
new CEO, according to people
familiar with the matter.
In recent weeks, when the
heads of GE’s major businesses
presented their 2018 budget
plans and projections, Mr.
Flannery sent some executives
back to redo the numbers with
deeper cuts, said people familiar with the process.
Mr. Flannery has been answering employee questions in
an internal video that goes out
every Friday. He recently responded to a question about
top executives getting company cars by disclosing that he
was killing the program, according to people familiar
with the matter.
GE’s new chief also is canceling an annual three-day,
invitation-only retreat to the
Boca Raton Resort & Club, a
networking event for GE
leaders scattered around the
globe, who spent afternoons
in Florida golfing and fishing.
Mr. Flannery plans to replace the event with a
slimmed-down version in January in Boston, which will be
attended by fewer participants.
Besides saving money, a
former GE executive said, the
winter event will deliver a
message from the new boss:
“There’s no time for sunshine.”
—Ted Mann contributed to
this article.
Photo by Deborah Samuel from PUP, published by Chronicle Books www.chroniclebooks.com
GE
If you are ever trapped under a
ton of rubble, I promise to sniff you out.
I promise to be worth every cent of the $10,000
that it took to train me.
I promise to ignore all other more fascinating smells
and concentrate on the scent of live humans.
I promise to go about my work with a wagging tail,
even if my paws get sore.
I promise never to give up.
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THE WALL STREET JOURNAL.
A10 | Thursday, October 19, 2017
IN DEPTH
LAUGHS
Continued from Page One
place of higher learning for 20
straight years, according to the
Princeton Review.
The performers are employees of the Provo, Utah, school
and must adhere to its honor
code, which includes following
church principles such as eschewing smoking and avoiding
coffee. Male cast members must
obtain university permission to
grow facial hair—dubbed a
“beard card” by students.
Writers at Studio C, which
launched in 2012 and began its
new season this month, must
avoid innuendo, cursing, politics—even the word “gosh,” because it sounds too much like
“God.” Flatulence jokes don’t
stand a prayer of getting past
the BYU television censors. But
bits like the appearance of curmudgeonly Harry Potter char-
acter Severus Snape on a
“Bachelorette”-like
reality
show—that works.
The result: a pop-culture
phenomenon that has racked
up more than 1 billion views on
YouTube—about a third of the
number of “Saturday Night
Live.” Studio C’s success, flying
in the face of comedy’s subversive ethos, is an irony not lost
on university officials.
“Here we have arguably the
most successful universitybased comedy troupe of all time
coming from what the world
would consider to be a conservative religious school,” says
Michael Dunn, managing director of BYU Broadcasting. Studio
C’s popularity has validated the
idea that “the absolute sharpest
comedy is clean comedy.”
Still, some have found reasons to be offended. One viewer
wrote in to complain about a
joke at the expense of a character with a hernia, saying that
“hernias are painful.” Others ob-
jected to a bit where people
shot at a cat. Another chastised
a cast member for using the
word “butt” in a social media
post, suggesting it would have
been better to opt for “derrière.”
To find laughs, Studio C uses
familiar comedic archetypes,
such as the “fish out of water,”
exaggeration and pop-culture
parodies, says Matt Meese, 34
years old, the show’s co-creator and one of its 13 cast
members. They try to raise the
stakes for every situation as far
as they can go, he says. A unifying theme is “struggle.”
Often, such as in the Scott
Sterling sketch, the struggle
involves physical pain for Mr.
Meese, or seemingly being the
only sane person in the
scene. On a “Who Wants to Be
a Millionaire” parody, his character is thrown off when
the studio audience, his wife
and a Stanford University historian insist that the 26th U.S.
president was George Washing-
ton. Against his better judgment, he selects Washington as
his final answer, and loses $1
million. In “Two Guys on a
Scooter,” a trip to the grocery
store between friends takes a
turn when 11 people, including
a grandfather and a police officer—all carrying items like a
bicycle or a watermelon—pile
onto the tiny scooter.
Studio C writers
must avoid innuendo,
cursing, politics—
even the word ‘gosh.’
Mr. O’Brien, a former writer
for “Saturday Night Live” who
now hosts his own late-night
show on TBS, says the cleanliness of Studio C’s humor was
almost an “afterthought” to
him. What got his attention
was the craftsmanship of the
skits, particularly their solid
endings, something he has always found challenging. “If
you’ve ever seen a church
group doing a sketch, you’re
very aware the whole time that
this has been sanitized,” he
says. “But for them, it didn’t
hurt the comedy at all.”
Cast members, who are current or former BYU students,
receive regular paychecks and
benefits. They say they know
intuitively what subjects are taboo. But on occasion, they see
what they can get away with.
Despite BYU’s aversion to
potty humor, they have tried to
get flatulence into several
sketches. One attempt involved
a James Bond-style torture
scene where the hero turns the
tables on his captors by passing
gas. Although the skit never
mentioned the word “fart” and
featured no expulsive noises, a
BYU broadcasting official rejected it. “It was so classy,”
says Mallory Everton, one of
the cast members. “It was just
actors exchanging looks. We
went full highbrow on a really
lowbrow idea.”
As Studio C’s popularity has
grown, cast members are routinely besieged by fans, who
have asked for selfies at the
Eiffel Tower, Disneyland, church
and even at a funeral.
The comedians, many of
whom are former missionaries,
said they like appealing to a
wide audience. Last year, an
apostle, one of the most senior
leaders in Mormonism, came to
a taping.
Cast member Jason Gray
said the experience was intimidating, like doing sketch comedy in front of the pope. Still, he
performed an impression of the
church official. “It was surreal,”
Mr. Gray said. “It’s comedy so
clean that literally an apostle
can go and have a good time.”
—Erich Schwartzel
contributed to this article
Continued from Page One
Clarke, a counterterrorism researcher at Rand Corp., a policy think tank. “They try to
find a place where there is an
ongoing insurgency, and they
latch themselves onto that
cause and exploit those local
grievances.”
President Duterte has
voiced concern that violence
could spread from Marawi to
other areas in the southern
Philippines. Analysts say revenge or copycat attacks are
likely to strike Manila or other
Southeast Asian capitals.
In mid-2016, ISIS called on
potential new recruits unable
to join it in the Middle East to
look to the Philippines. ISIS
media agencies have promoted
the Marawi conflict to their
followers.
“It will be difficult to replicate a similar urban assault
like Marawi in the short
term,” said Francisco J. Lara,
Philippines country manager
of peace-building agency International Alert. “But the
threat of a similar attack in
the future remains real.”
Marawi is on Mindanao island, long known as a haven
for extremists, from communist guerrillas to separatist
Muslims. The U.S. for years
has kept a small special forces
contingent on the island.
The militants in Marawi,
known as the Maute after the
brothers who led them, Omar
and Abdullah Maute, received
funds from ISIS and modeled
many of their tactics on the
group, Philippine officials say.
Their goal was to create a caliphate, or Islamic kingdom,
with fighters from abroad including Indonesia, Saudi Arabia
and Yemen, these officials say.
Marawi was once a relatively prosperous trading hub,
surrounded by hills and a lake.
It is predominantly Muslim,
with the minarets and domes
of mosques. There is a small
Catholic minority.
The tale of the Marawi battle—told by the Philippine military and witnesses on the
ground, including former hostages—shows how ISIS-inspired militants can quickly
consume a city far from its
base and supply lines in the
Middle East.
It began May 23. Soldiers
and police moved in on a
house after receiving intelligence showing the Maute
brothers and another militant
leader, Isnilon Hapilon, were
hiding there.
The military, which inadvertently interrupted a plan to
occupy Marawi, found itself
laying a siege that would last
roughly five months.
Known for kidnapping and
beheading foreigners from
tourist resorts even before his
ISIS affiliation, Hapilon is on
the U.S. State Department’s
most-wanted-terrorists list. In
2014, he swore allegiance to
ISIS, which two years later endorsed him on its central media channel as its “emir,” or
ruler, in Southeast Asia.
The Maute brothers were a
lesser-understood threat. They
were educated in Egypt and
Jordan and from an elite local
family, according to the Institute for Policy Analysis of
Conflict, a terror-research
group in Jakarta. In 2016, they
briefly occupied a town about
a two-hour drive from Marawi.
Their group later attacked a
Marawi prison, releasing some
of their captured fighters, and
bombed a night market in
Davao City, President Duterte’s
hometown.
Before government troops
could get close on May 23,
LINUS GUARDIAN ESCANDOR II FOR THE WALL STREET JOURNAL
WAR
Months of fighting between the Philippine military and well-armed Islamist militants devastated Marawi, above, and drove some residents to evacuations camps, below.
they came under fire from several buildings and retreated.
Soon, hundreds of heavily
armed fighters who had infiltrated Marawi began flooding
the streets, planting the black
ISIS flag in public areas and
taking hostages, primarily
Christians and the Muslims
who sought to protect them.
The militants torched a cathedral and a school. Photographs by residents show
Maute fighters in dark clothing and hats or balaclavas patrolling streets and mounting
ISIS flags on vehicles. Civilians fled to surrounding
towns and to government-run
refugee camps. President Duterte declared martial law in
Mindanao.
A hostage’s tale
Mr. Samiahan, who witnessed the hostage’s execution, had lived in Marawi for
five years. His family of seven
slipped out the back of their
house after darkness and hid
in the tall grass of an adjacent
field as Maute fighters, yelling
in triumph, set fire to the
next-door Dansalan College, a
Christian school.
The family spent the night
huddled in the rain as Maute
fighters shined flashlights
across the grassy field. They
were so close, Mr. Samiahan’s
wife, Yolanda, said, “you could
almost shake their hands.”
In following days, they hid
in a hospital and other buildings before deciding no rescue
was coming. Attempting to
leave the militant-controlled
part of the city, they were
stopped at a Maute check200 miles
200 km
Manila
So u th
Chin a
Se a
Philippin e
Se a
PHILIPPINES
Marawi
Su lu
Se a
M I NDA NAO
M A L AY S I A
Ce le b e s Se a
THE WALL STREET JOURNAL.
point. There, militants tested
residents to see if they were
Muslim or Christian: Only
those who could reply to a
Muslim greeting in Arabic
were allowed to leave.
Mr. Samiahan, unlike most
of his relatives, failed the test
and was locked in a warehouse.
On his second night, one captive tried to loosen his bonds
while the Maute were sleeping.
When fighters discovered the
ruse, they performed the beheading and forced the remaining hostages to bury the head,
Mr. Samiahan said.
It took the military several
days to mobilize and push
Maute fighters back from
western portions of the city
and liberate the city hall and
hydroelectric dams that provide most of Marawi’s power.
The Maute fought back
fiercely, killing several troops.
By May 28, bodies of at
least 16 civilians had been recovered, according to military
officials, including those of
eight men who were dumped
in a ravine—the number had
climbed to at least 47 late last
week. Several were shot in the
head with hands bound, accompanied by a sign in a local
language reading “traitor,” according to local media reports.
The Agus River bisects
Marawi, with the central business district and Marawi’s
largest mosque and church in
the Maute-controlled east.
Maute fighters fortified three
bridges, presenting a formidable obstacle to the military’s
counteroffensive, and soldiers
who tried crossing were met
with sniper fire and rocketpropelled grenades.
The military, unused to urban warfare, called in airstrikes. Lacking guided munitions, the Philippine military
divebombed the city with
FA-50 jets and OV-10 Bronco
propeller aircraft. On May 31,
a badly aimed airstrike killed
11 soldiers. Government officials called it a tragic incident
and launched a review.
In early June, the U.S. disclosed it was providing special
forces assistance to Philippine
troops but didn’t elaborate.
The constant aerial bombardment devastated Marawi’s
center. Businessman Solaiman
Mangorsi, 58, said he lost
nearly $600,000 in damaged
property after bombs struck
areas that included a bookstore
and other properties he owned.
He said he wasn’t insured.
By mid-June, the battle had
become a grind, with both sides
digging in. Militants avoided
airstrikes by boring holes in
walls so they could move from
house to house undetected.
A Christian hostage, Lordvin Acopio, a 29-year-old
teacher, said militants forced
him and other captives to
make improvised explosives
from firecrackers and shrap-
nel. They sent other hostages
to search houses for guns,
food and ammunition.
As the weeks passed, more
hostages escaped. Mr. Samiahan, who witnessed the execution, broke free after discovering a padlock wasn’t properly
closed. He made a mad dash
for the military-held portion of
the city, leaping over concrete
barriers and plunging into the
river and to safety.
Mr. Acopio escaped at night
after a mosque he was held in
was bombarded with tear gas.
He and a priest scrambled
through a hole blasted in the
building, he said, and “just ran
and ran and ran.”
The final battles
By early September, the
military had achieved several
key victories, taking back
landmarks including Marawi’s
largest mosque. And it concluded, based on intercepted
terrorist chatter, that Abdullah
Maute had been killed in late
August. By September’s end
they had retaken the remaining bridges and pushed the
militants into a few blocks
bordering the lake.
The final battles were
fought in close quarters. In
one mission, Sgt. Roderick Peruandos of the Philippine Marine Corps, led a team to clear
houses on the approach to
what is known as the “White
Mosque,” where senior militants including Hapilon were
believed to be holding out.
Moving room to room, they
spotted a hole in the floor,
when suddenly a homemade
grenade was tossed out.
One corporal, who celebrated his 27th birthday with
his squad just a few weeks earlier, was killed almost instantly, said Sgt. Peruandos.
The grenade was made, he
said, out of scrounged shrapnel
and explosives from firecrackers and unexploded bombs
dropped during airstrikes.
The other marines fled,
leaving Sgt. Peruandos alone
to fend off insurgents with rifle fire as he wrapped a tourniquet around his wounded
leg. After an hour of bombardment, he crawled to safety, a
bone in his leg snapped in
two. The insurgents, though
weakened, were left secure in
their redoubt.
The government on Monday
said Omar Maute and Hapilon
had been killed, and the military said its offensive had
boxed the remaining militantcontrolled area to one or two
hectares. The bodies of the two
leaders were recovered and the
remaining 30-odd fighters
“were seen scampering in disarray,” the military said.
If Marawi is declared militant-free, the Philippine government will then face painstaking
work
clearing
improvised explosive devices
and rebuilding the city. Tens
of thousands of displaced people whose homes were destroyed remain in government-run camps.
Sgt. Peruandos, who has
fought communist rebels and
gangs in Mindanao for nearly
all his 15-year military career,
said he had never encountered
an enemy like those who
nearly killed him in Marawi.
“It’s like they don’t care for
their lives,” he said. “They just
want to kill or be killed.”
After authorities declared
the militant leaders dead, a
pro-ISIS messenger channel
said the group would train
new recruits with combat
knowledge learned from the
battle, according to SITE Intelligence Group, which monitors
jihadist activity online. The
channel declared: “Marawi is
just the beginning!”
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To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | A10A
NY
* * * *
GREATER NEW YORK
Connecticut Gets a Budget Deal
RICHARD DREW/ASSOCIATED PRESS
BY JOSEPH DE AVILA
Cuomo, center, examined New York City subway tracks in August.
Connecticut’s monthslong
budget impasse may be coming to an end.
Democratic and Republican
leaders in the state Legislature
said Wednesday they reached
a preliminary budget deal and
intend to vote on it next week.
The state hasn’t had a budget
since the fiscal year ended in
June as lawmakers failed to
reach a solution to close a
two-year, $3.5 billion deficit.
“We have a tentative agreement on major issues,” said
Republican House Minority
Leader Themis Klarides.
“There will be people who
hate this, there will be people
who love this.”
The bipartisan group of
lawmakers has been working
for weeks on crafting a new
agreement after Gov. Dannel
Malloy, a Democrat, vetoed a
budget passed in September.
The legislative leaders said
they intend to seek enough
support from rank-and-file
members to produce a vetoproof majority, should the
governor seek to veto this
budget as well.
Mr. Malloy said he would
withhold judgment on the plan
until he can review all of the
details. Legislative leaders
said they hoped the governor
could be persuaded to support
this agreement.
“I don’t think it serves the
state well to go through a
whole veto process and override,” said House Speaker Joe
Aresimowicz, a Democrat.
“Let’s all agree that the public
wants a bipartisan agreement
signed off by the governor to
move the state forward.”
This new agreement doesn’t
include a controversial proposal from Mr. Malloy that
would have shifted about $282
million in teacher pension
costs from the state to munici-
‘There will be people
who hate this, there
will be people who
love this.’
Gov. Cuomo’s
Infrastructure
Credentials Tested Candidates for New Jersey Governor Square Off
It was about 10 p.m. in Madrid one day last October
when a top executive of
Spain’s Obrascón Huarte Laín
SA got a call from New York
Gov. Andrew Cuomo.
Mr. Cuomo was concerned
that an OHL subsidiary
wouldn’t meet the deadline to
outfit a subway station on the
new Second Avenue line in
Manhattan ahead of its scheduled opening on New Year’s
Day 2017. He asked Ignacio Botella, the head of OHL’s construction division, to fly to
New York.
“He got the message,” recalled Michael Horodniceanu,
the Metropolitan Transportation Authority’s then-head of
capital construction, who was
sitting in Mr. Cuomo’s Midtown office during the call.
When Mr. Botella arrived in
the city, the governor told him
that he expected OHL to deliver on such an important
project.
A spokesman for the OHL
unit confirmed the call and
site visit.
The episode reflects the
Democratic governor’s positioning as an infrastructure
champion. In Manhattan, a
$1.6 billion commuter train
hall is rising from the shell of
a beaux-arts style post-office
building. In Queens, LaGuardia
Airport is undergoing an $8
billion transformation into a
world class gateway. Thirty
miles to the north, a 3-milelong, $4 billion bridge named
after Mr. Cuomo’s father, former Gov. Mario Cuomo, is
nearing completion.
Subway Problems
Built Up Over Time
Most of today’s subway
problems aren’t of New York
Gov. Andrew Cuomo’s making.
The Metropolitan Transportation Authority has underinvested in new equipment for decades. Its struggles were
exacerbated by superstorm
Sandy, which sent floodwaters
pouring through rail yards, stations and underwater tunnels in
2012, causing more than $4 billion of damage.
Some observers worry that
the most urgent problem at the
MTA is a growing backlog of
maintenance work. A recent
agency report estimated that
the authority needs to spend as
much as $30 billion every five
years just to maintain a system
that relies in part on signals
from the 1930s and on rolling
None of these projects
would have progressed so
quickly were it not for the
Democratic governor’s personal attention, people associated with the projects say.
Now, that singular focus, and
reputation as the infrastructure governor, is being tested
by persistent delays and disruptions in the New York City
subway system, just as he prepares to seek re-election next
year.
To some former senior MTA
employees, the governor’s
constant monitoring of new
projects and push for in-person meetings has distracted
officials from maintaining the
century-old subway system,
which carries 5.7 million people every weekday. The governor’s allies dispute that, saying his firm hand keeps
everyone on budget and focused on meeting deadlines.
In his annual State of the
State address in 2016, Mr.
Cuomo talked of spurring $100
billion worth of investment in
mass transit, roads, bridges
and airports across New York.
His attention to infrastructure is reflected in his interest
in the finer details of construction projects. At LaGuardia, which is run by the Port
Authority of New York and
New Jersey, Mr. Cuomo ordered changes to the roof lines
on a terminal development to
ensure uniformity across the
airport, according to a person
familiar with the project.
Mr. Horodniceanu, who
praises the governor’s approach, said that on the Second Avenue subway, Mr.
Please see CUOMO page A10B
stock from the 1960s.
Instead of increasing spending on maintenance, Mr. Cuomo’s
critics say he is focused too
much on ribbon-cutting projects
like extending the Second Avenue line and adding track to the
Long Island Rail Road.
Jamison Dague, director of
infrastructure studies at the
Citizens Budget Commission, a
nonpartisan watchdog group,
said the addition of these projects in a recent amendment to
the agency’s five-year spending
plan showed “a misprioritization” of capital funds.
A senior MTA official rebutted that assertion. “It’s not a
choice of one or the other,” the
official said, pointing to $3 billion that will be spent on overhauling signal equipment over
the next three years. “We need
to continue to expand and to
maintain the system,” the official said.
—Paul Berger
JULIO CORTEZ/PRESS POOL (2)
BY PAUL BERGER
palities over the next two
years. The governor said the
state eventually would be unable to cover those costs. City
and town officials across Connecticut were widely opposed
to the change.
Mr. Malloy said the absence
of that proposal wouldn’t necessarily prompt him to veto
the budget.
“I don’t think there is any
one thing that would cause me
to veto a budget,” he said.
“But there is probably an accumulation of things that, if I
find those, would be difficult
for me to sign.”
Republicans backed off
their demands for changes to
the pensions of teachers and
state employees. Mr. Malloy
has said those proposals are
likely illegal and would have
been challenged in court by
public-sector unions.
The new agreement would
give additional aid to Hartford.
Officials in the capital city
have said it could file for bankruptcy as early as next month
if the state doesn’t help out.
Phil Murphy: ‘When residents…feel
comfortable about engaging with law
enforcement and they’re not worried about
their immigration status, without question
you have a safer environment.’
Kim Guadagno: ‘I don’t believe that the people
of New Jersey want to see a violent criminal
released from our jails if there’s an
immigration detainer against them.’
Debate Lays Bare Split on Immigrants
BY KATE KING
After a fraught week of
campaigning, the Democratic
and Republican nominees for
governor of New Jersey met
again Wednesday in a debate
that underscored deep policy
divisions between their two
campaigns.
Republican Kim Guadagno,
who has been outgoing Gov.
Chris Christie’s lieutenant gov-
ernor since 2010, has campaigned heavily on the promise that she will lower
property taxes in her first
term.
Over the last week, Ms.
Guadagno, a former sheriff,
has also sought to position
herself as tough on crime. At
Wednesday’s debate, she said
her opponent’s pledge to protect undocumented immigrants in New Jersey from de-
portation
“will
harbor
criminals, it will impact and
challenge law-enforcement officers.”
Democratic candidate Phil
Murphy, a former Goldman
Sachs executive, has run on a
progressive campaign platform and said he is committed
to opposing many of President
Donald Trump’s policies, including on immigration. He
said the threat of deportation
can prevent people from cooperating with law enforcement.
“Our dreamers, our immigrant families, we have to
make sure that they know that
they’re welcome in this state,”
Mr. Murphy said.
A poll released Friday by
Stockton University showed
Mr. Murphy with a nearly 18point lead over Ms. Guadagno
among likely New Jersey voters.
Cornell Puts Liberal-Arts Minds Into Tech
BY LESLIE BRODY
A new Cornell University
program aims to help liberalarts students bring humanistic
values to technology fields and
address ethical quandaries in
the fast-changing digital world.
The school plans to formally
announce the $20 million initiative on Thursday. A group of
students at Cornell’s College of
Arts and Sciences in Ithaca will
be able to take specialized
courses in computer science,
free summer sessions at Cornell
Tech’s new campus on Roose-
velt Island and internships in
New York City.
School officials said they
hope to develop a pipeline of
leaders who can tackle issues
such as the misuse of social media, privacy breaches, the integrity of electronic voting and automation’s impact on jobs.
“We’re all seeing today the
incredible challenges of producing digital technology that reflects humanistic values,” said
Daniel Huttenlocher, dean of
Cornell Tech. “The goal is to
start to train students who are
thinking about these issues
when designing technologies.’’
This program comes as many
college students are moving
away from liberal-arts degrees
and toward fields with clearer
job prospects, such as engineering and health sciences.
Just below 12% of the bachelor’s degrees conferred in 2015
were in the humanities, down
from about 15% a decade earlier, according to the American
Academy of Arts & Sciences.
The new initiative, known as
the Milstein Program in Technology and Humanity, will be
the first to bring undergradu-
ates in Ithaca to Cornell Tech’s
graduate campus. The program
will choose about 25 students
yearly for the four-year program.
Funding comes from the
family of Howard P. Milstein, a
1973 Cornell graduate who runs
banking and real-estate companies. His son Michael, a 2011
Cornell graduate who works in
the family business and was involved with the initiative, said
he wanted to foster an “interdisciplinary approach that can
help unlock the value of liberal
arts in the 21st century.”
OYSTER PERPETUAL
cosmograph daytona
rolex
oyster perpetual, cosmograph and daytona
are ® trademarks.
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A10B | Thursday, October 19, 2017
NY
THE WALL STREET JOURNAL.
* *
GREATER NEW YORK
Landlords Make a Play for Williamsburg Residents
Rental pitches target tenants in the trendy Brooklyn neighborhood as a temporary shutdown of the L train looms
BY JOSH BARBANEL
Developer Unfazed
By Poaching Threat
L
At Level, a new 41-story
rental tower on the East River
in Williamsburg, the threat of
competition from developers
in downtown Brooklyn seems
like a distant dream, despite
the impending shutdown of a
transit lifeline for the area.
“We are renting up fantastically well,” said Jeffrey E.
Levine, chairman of Douglaston Development LLC, which
built Level.
Mr. Levine said Level is
well positioned to handle the
temporary L train shutdown,
with its river views, amenities,
a ferry landing and plans for a
shuttle bus. He said he isn’t
worried about the competition
buying ads based on words
like “Williamsburg rentals.”
“If you are putting in a
keyword to buy a Porsche
and someone presents you
with a Volkswagen, you are
going to buy the Porsche,” he
said.
—Josh Barbanel
MARK KAUZLARICH FOR THE WALL STREET JOURNAL
andlords across the
New York metropolitan
area are trying to woo
Williamsburg residents, who
soon will find themselves
without a crucial subway line
for at least a year.
People searching online for
rentals in the trendy Brooklyn neighborhood can now
find paid links to new buildings like the Offerman House
in downtown Brooklyn, with
loft-like apartments in a former 19th-century department
store, or the 53-story Journal
Squared tower
PROPERTY in Jersey City.
The Instagram hashtag
#Williamsburg appears with
images of 33 Bond Street, a
new 25-story building with a
private garden and co-working spaces in downtown
Brooklyn.
At 461 Dean Street, a 33story building next to the
Barclays Center, marketers in
downtown Brooklyn are targeting Williamsburg residents
with social media posts saying it has “11 subway lines at
your doorstep” and is “convenient to Williamsburg.” Some
are looking to step up advertising on subway entrances
and on the streets.
They are making a pitch to
the increasingly affluent Williamsburg renters who are
facing a temporary shutdown
of the L train, now scheduled
to begin in the spring of
2019. The shutdown of the L
train’s tunnel to Manhattan,
set to last 15 months, could
snarl commuting in many
The apartment building 461 Dean Street, next to the Barclays Center, is one of the spots being marketed to Williamsburg residents.
parts of Williamsburg.
Though the shutdown is
still 18 months away, marketers said developers are beginning to ramp up, and will
do more over the next year
as leases expire and renters
decide whether to renew or
move.
“As articles of the impending shutdown appeared, we
started advertising and targeting people in the neigh-
GREATER NEW YORK WATCH
HOSPITAL AID
Bus Ran Red Light,
Investigators Say
Agreement Ends
Funding Dispute
A charter bus that slammed
into a Metropolitan Transportation Authority bus last month in
a deadly accident in Queens ran
a red light immediately before
the impact, according to details
Wednesday from the National
Transportation Safety Board.
The Sept. 18 crash in Flushing
killed three people—the charterbus driver, Raymond Mong, 49
years old, a passenger aboard
the city bus and a pedestrian—
and injured more than a dozen
others.
The charter-bus company,
Dahlia Group Inc., has repeatedly
declined to comment on the
crash.
Investigators have said the
Dahlia bus was traveling at
about 58 miles an hour when it
hit the MTA bus.
—Melanie Grayce West
The head of New York City’s
public hospitals said Gov. Andrew
Cuomo’s administration has
agreed to disburse some $380
million in aid to the agency, ending a funding dispute that left the
system dangerously low on cash.
Stanley Brezenoff, interim
president and CEO of NYC Health
+ Hospitals, made the announcement in a letter to agency employees. A spokeswoman for Mr.
Cuomo didn’t immediately return
a request for comment.
NYC Health + Hospitals is financially troubled and in the
midst of an overhaul. Mr. Brezenoff said the system continued to face big challenges in providing care for uninsured patients
without reimbursement, and amid
looming uncertainty in Washington, D.C.
—Mara Gay
CUOMO
Continued from page A10A
Cuomo directed that the 96th
Street station entrance be
lighted in blue, day and night,
and that the New York state
motto “Excelsior” and the U.S.
motto “E Pluribus Unum” be
displayed on girders above the
platforms.
The MTA runs the city’s
subway system and buses, two
suburban commuter railroads
and nine bridges and tunnels.
Some former senior figures say
Mr. Cuomo puts officials at the
agency under constant pressure. “I don’t think there’s any
question that the governor sees
the entity of the MTA as a mule
[that] only responds to being
beaten on the ass with a stick,”
one former employee said.
An ally of the governor’s,
who formerly served as a senior administration official,
said Mr. Cuomo “leads with a
firm hand.” But he added that
the governor places pressure
in Journal Square is next to a
PATH station with an 11-minute ride to the financial district and a 22-minute ride to
Herald Square.
The campaigns have some
skeptics. Andrew Barrocas,
chief executive of MNS, a
Brooklyn-based brokerage
that represents Level, a new
waterfront rental in Williamsburg, said the advertising
“confuses people.”
“You get very little crossover between Williamsburg
and downtown Brooklyn,” he
said.
But developers and advertisers say their carefully targeted search and social media
marketing at Williamsburg
has measurable results, with
up to 8% of people online
clicking through to learn
more about the building.
The Ashland and 461 Dean
Street reported that a total of
19 apartments were rented to
people since the summer who
gave their last address in
Williamsburg. At Journal
Squared, 20% of the renters
hail from Brooklyn, with the
largest group coming from
Williamsburg, followed by
Park Slope, said Jason Segal,
director of residential leasing
at the project’s developer,
KRE Group.
on everyone—contractors, subcontractors, public officials,
state and federal agencies—in
the pursuit of getting things
done.
A spokeswoman for the governor, Abbey Fashouer, said:
“The magnitude of this undertaking demands a high level of
attention, and the governor is a
hands-on executive who has
worked to restore faith in government’s capacity to deliver
projects on-time and on-budget.”
Several projects, such as the
replacement of the Tappan Zee
Bridge with the Cuomo bridge
and the conversion of the
James A. Farley Post Office
building into a commuter train
hall, stalled for decades until
Mr. Cuomo put them on his
agenda.
As recently as 2014, Mr.
Cuomo called the MTA’s proposed five-year plan for new
buildings and equipment
“bloated,” leading the budget
to be cut by almost 10%, or $3
billion.
This year, the governor re-
stored $2.9 billion to the MTA’s
five-year spending plan. The investment contributed to extending the Second Avenue line
to East Harlem, adding a third
track on the Long Island Rail
Road to ease congestion, and a
rolling program to renovate 33
subway stations at a cost of
nearly $1 billion.
All looked well until this
spring and summer, when there
were a spate of subway disruptions, including equipment
breakdowns, rush-hour signal
failures, chronic overcrowding
and a derailment that injured
dozens of people.
Initially, Mr. Cuomo blamed
the disruption on previous administrations and New York
City for underfunding the
agency. He also said he didn’t
have control of the MTA.
This summer, he pledged an
extra $1 billion in state funding
for the MTA, declared a state
of emergency to speed up procurement and overhauled the
agency’s top leadership. He
also personally took reporters
on tours of the subway’s power
system and its track cleaning
program.
Even disillusioned former
MTA officials say Mr. Cuomo is
attacking the subway problems
now with the same zeal he devoted to ribbon cuttings like
Second Avenue.
“Like him or dislike him,”
said one such official, “when
the governor puts his mind to
something he gets it done.”
®ROBERTOCOIN
FATAL CRASH
borhood along the L line in
buildings similar to ours,”
said Matthew Berenson, a
vice president at the Gotham
Organization, which is renting out the Ashland, a new
53-story building in Fort
Greene on the edge of downtown Brooklyn.
Downtown is served by
many subway lines and the
Long Island Rail Road, and
the Journal Squared project
CORRECTIONS AMPLIFICATIONS
Former investment manager Steven Canady was sentenced Tuesday in Manhattan
Criminal Court following a
June conviction on larceny,
fraud and forgery charges. An
article Wednesday misidentified the court as Manhattan
federal court.
Readers can alert The Wall Street
Journal to any errors in news articles
by emailing wsjcontact@wsj.com or
by calling 888-410-2667.
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* * * * *
LIFE&ARTS
BY NEIL SHAH
IN THE AGE OF HIP-HOP, female pop stars are facing an identity crisis.
In July, R&B/hip-hop surpassed
rock for the first time to officially
become the biggest music genre in
America, according to Nielsen
Music, which tracks online streams
and digital and physical albums.
As of Oct. 12, R&B/hip-hop has
driven 24% of music consumption in 2017—more
than rock’s 21% and double pop’s 12% share.
So far this year, 20
of the 25 moststreamed songs on
Spotify, Apple Music and other ondemand audio
services are by
R&B/hip-hop
acts such as
Kendrick Lamar,
Migos, Childish
Gambino and Lil
Uzi Vert, Nielsen’s
data shows. Two are
by male pop stars
(Ed Sheeran, Bruno
Mars). Not one is by a
female pop artist.
At the same time, a
string of white A-list
arena-pop stars—Lady
Gaga, Katy Perry, Miley
Cyrus, even Taylor
Swift—have stumbled over
the past year amid poor reviews, underperforming singles, or disappointing sales.
“It’s a real shift going on with
pop music—we’re showing that
hip-hop is pop music,” says Andre
Torres, vice president of urban
catalog at Universal Music Enterprises, a division of Universal Music Group, the world’s biggest music company. He says female pop
artists who “are unsure about who
they are and who they want to be”
are finding it harder to navigate
today’s pop landscape.
Hit machines Katy Perry and
Lady Gaga—who together have produced 12 chart-topping songs in the
MILEY CYRUS
‘It’s a real shift going on
with pop music—
we’re showing that
hip-hop is pop music.’
past decade—have both failed to
deliver a no. 1 song with their new
albums. “Witness,” which Ms.
Perry released in June, and
“Joanne,” Lady Gaga’s album from
October 2016, are widely seen in
the music industry as critical and
commercial disappointments. Miley
Cyrus, whose newest album, “Younger Now,” arrived last month,
peaked at No. 5 on the Billboard album charts, after hitting No. 1 with
her 2013 album, “Bangerz.”
Five of the 10 songs to hit no. 1
on the singles chart this year have
been rap, the most ever, Billboard
notes. The other five include one
R&B, one Latin and two male pop
songs. The only female pop single
to hit no. 1 was Taylor Swift’s
“Look What You Made Me Do.”
Meanwhile, R&B/hip-hop artists
like Drake, Rihanna and Beyoncé
have more easily crossed over into
pop in the past decade and now
dominate mainstream culture. The
expanding genre is squeezing traditional white female pop stars off
the stage. “With young streaming
subscribers bypassing female pop
acts in favor of hip-hop and R&B,
A&R execs are combing SoundCloud looking for the next Drake or
Kendrick, rather than the next Taylor,” says Craig Marks, editorial director at Townsquare Media, which
owns over 300 U.S. radio stations.
While a new crop of female pop
stars such as Lorde, Carly Rae
Jepsen, Kesha and Tove Lo are generally hailed by critics, they have
relatively niche audiences compared to the stadium-sized crowds
that flock to big names like Taylor
Swift. Ms. Jepsen, for example, is
the opening act for Katy Perry’s up-
LADY GAGA
Thursday, October 19, 2017 | A11
KATY PERRY
Hip-Hop Takes
Over
Five of the 10 songs to hit No. 1
on the singles chart this year
have been rap, the most ever.
—Neil Shah and Abbey Crain
TAYLOR SWIFT
‘Rockstar’
Post Malone
From: Syracuse, New York
Along with G-Eazy, Post Malone
is the latest in a string of new
white rappers following in the
footsteps of Eminem.
‘Bodak Yellow
(Money Moves)’
Cardi B
Bronx, New York City
Cardi B started as a reality TV
star. Her smash hit is the first
solo No. 1 by a female rapper
since Lauryn Hill in 1998.
‘I’m the One’
DJ Khaled
New Orleans, Louisiana
MUSIC
The Pop Diva
Identity Crisis
With the rise of hip-hop, a string of A-list pop stars like Taylor Swift,
Lady Gaga, Miley Cyrus and Katy Perry have stumbled
coming shows in
North America
early next year.
“There is a
changing of the
guard,” says Pat
Corcoran, who
manages Chance
the Rapper, an independent hip-hop
artist who’s now
one of the music
industry’s most
powerful players.
While noting the
rise of niche pop
stars like Kesha,
Hailee Steinfeld
and Julia Michaels, Mr. Corcoran
points out that hip-hop/R&B stars,
such as SZA, are appealing to
broader audiences than they had in
the past. “Who’s to say [SZA’s] not
a pop star?” Mr. Corcoran says.
A representative for Katy Perry
noted that “Witness” debuted at No.
1 on the Billboard albums chart and
that Ms. Perry is among those artists who “stay ahead of the curve
and take their audiences along on a
career-long artistic journey.” Ms.
Swift’s camp did not return calls for
comment. A representative for Lady
Gaga declined to comment.
Historically, the core of the popdiva audience has been teen girls.
Experts say these same fans aren’t
as interested in the staged artificial
personas of many pop stars such as
Lady Gaga. They are now interested in hip-hop where lyrics are
more direct and true to life. “It’s
the era of authenticity,” says Peter
Edge, chairman and chief executive
of RCA Records, which represents
Kesha, Ms. Cyrus and SZA. “What
are you really going through? What
do you really think? How much are
you really speaking to what’s going
on with you?”
Joya Syed, 18, a sophomore at
Bard College, grew up listening to
pop stars such as Taylor Swift. But
she recently got into R&B/hip-hop
artists like Kehlani, Cardi B,
Rihanna and Beyoncé. They talk
about relationships with maturity
and are proud of their backgrounds,
she says. “It’s more realistic.”
For some fans, a long-time popindustry tactic—enlisting rappers
as featured guests to spice up pop
albums—is getting old. In 2015,
Taylor Swift brought on Kendrick
Lamar for her song “Bad Blood.”
Katy Perry enlisted rap trio Migos,
female rapper Nicki Minaj and reggae artist Skip Marley on her
“Witness” album.
Richey Collazo, a 21-year-old
DJ Khaled is known as the King
of Snapchat, getting more than
3 million views for his stories
detailing his diet, family life and
lavish lifestyle.
‘Humble’
A new crop of
female pop stars
such as Kesha, left,
Lorde and Tove Lo,
are generally hailed
by critics but they
have relatively
niche audiences.
The Rise of Hip–Hop
U.S. music consumption year-to-date
for selected genres, compared to 2015.
2015
156.6 million units*
2017
121.1
150 mil.
Rock
125
100
R&B/Hip-Hop
75
Pop
50
25
107.2
61.5
Country
37.3
0
*Sales of physical and digital albums, track-equivalent
units, audio streams and video streams, as of Oct. 12
Source: Nielsen Music
musician and fan, says today’s artists should be more sensitive
about appropriating black culture.
Miley Cyrus, for example, was
widely criticized in 2013 for
“twerking” on television. “That’s
why the white female pop star is
dying … Their entire basis in the
industry has always been taking
bits and pieces of everything to
make themselves seem more interesting,” the musician says.
RCA Records’ Mr. Edge says Ms.
Cyrus’s dive into hip-hop was
ahead of the curve and that her
pivot away into country on her latest album isn’t disrespectful. Others disagree. Universal Music
Group’s Mr. Torres says pop stars
should remain consistent in their
attitude toward hip-hop. “If you’re
going to get on this bus with us,
you need to stay on,” he says.
To be sure, Lady Gaga, Katy
Perry and Miley Cyrus may simply
be past their hitmaking primes,
music executives
say. Taylor Swift,
Adele and veteran
pop acts like Pink can still fill huge
venues and there are plenty of
successful white male pop stars
like Ed Sheeran, Sam Smith and
Shawn Mendes. These male stars
haven’t been accused of borrowing
from hip-hop as much as Ms.
Cyrus or Ms. Perry.
Female pop’s newer successes
are staying relevant by abandoning
the typical pop-star playbook, music industry professionals say.
Kesha, a white female pop star,
took a country-rock turn on her latest album, “Rainbow,” released in
August. But fans embraced the shift.
“It’s something that has always
been there—it’s not something she
made up,” says Richey Collazo, the
musician. Instead of undergoing a
whole-scale image makeover, Lorde
has zeroed in on a part of her musical personality—an alternative-pop
that evokes Kate Bush. Likewise,
Carly Rae Jepsen has focused on
synth-heavy ‘80s pop.
The biggest question mark in the
music business is whether Taylor
Swift, whose new album “Reputation” is set to be released Nov. 10,
can match past successes in a pop
scene dominated by hip-hop. Critics
note that she is including multiple
genres in her new music to appeal
to a broad audience, yet she’s also
writing about personal themes such
as her own celebrity.
The two tracks released from
“Reputation” so far portray a
darker, more villainous persona.
Some critics including Sarah MacDonald of VICE’s Noisey music site
believe this is a response to heightened media criticism of the country-turned-pop singer. “Look What
You Made Me Do,” released in late
August, is still a top five single.
However, “…Ready For It?,” which
was released in early September
and has hip-hop elements, has
slumped down the charts. Critics
have panned both tracks. Ms. Swift
Kendrick Lamar
Compton, California
A seven-time Grammy Award
winner, he is known for a lyrical
approach to rap. He broke into
the mainstream with his 2012
album ‘good kid, m.A.A.d city.’
‘Bad and Boujee’
Migos
Lawrenceville, Georgia
Migos helped bring the subgenre
‘trap’ music to the mainstream,
shepherding phrases like ‘Bad and
Boujee’ and ‘Versace Versace’
into the popular lexicon.
2017’s Five Other
No. 1 Singles
’Starboy’
The Weeknd (R&B)
’Despacito’
Luis Fonsi (Latin)
’Shape of You’
Ed Sheeran
(pop-male)
’That’s What I Like’
Bruno Mars (pop-male)
’Look What You Made
Me Do’
Taylor Swift (pop-female)
Source: Billboard
is at a crossroads in her career, observers say. “I think she just wants
to be fully herself at this juncture,”
says Mr. Corcoran, Chance’s manager. “She’s got nothing more to
prove to anyone on the business
side,” he says. “After you have so
many hits under your belt, that
doesn’t really matter anymore.”
GETTY IMAGES (10)
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THE WALL STREET JOURNAL.
A12 | Thursday, October 19, 2017
LIFE & ARTS
JODI COBB/NATIONAL GEOGRAPHIC/GETTY IMAGES
‘Jerome Robbins’ Broadway’ is a
medley of some of his greatest works.
SIGHTINGS | By Terry Teachout
The Return of a Choreographic Coup
MOST PEOPLE who go to the theater regularly keep a little list of
unforgettable shows. Mine is
topped by “Jerome Robbins’ Broadway,” the 1989 revue in which
Broadway’s greatest choreographer
restaged an evening’s worth of his
production numbers from “Billion
Dollar Baby,” “Fiddler on the Roof,”
“A Funny Thing Happened on the
Way to the Forum,” “Gypsy,” “High
Button Shoes,” “The King and I,”
“Peter Pan,” “On the Town” and
“West Side Story.” I’m not old
enough to have seen the original
productions of any of the 15 musicals that Robbins choreographed
between 1944 and 1964, when he
left Broadway to concentrate on
ballet. I figured I’d never get another chance to see their dances
staged by the master himself, so I
bought a ticket to the first preview.
I went back five more times—all on
my own dollar. A notorious perfectionist, Robbins had spent an unprecedented 22 weeks in rehearsal.
It showed: Never in my life have I
seen a more perfectly realized
stage production.
One of the reasons why I kept
going back was that I took for
granted that the show was too
complicated and expensive an undertaking to be more than a oneshot event. I was right. After a 633performance Broadway run, it
toured 12 cities, closing in Los Angeles in February 1991. It has never
been performed since then. So I
was flabbergasted—no gentler
word will suffice—when St. Louis’s
Muny, America’s largest and oldest
outdoor musical theater, announced
last week that it would revive “Jerome Robbins’ Broadway” in the
summer of 2018 as part of its
100th-anniversary season.
Why does the revival of a quarter-century-old musical-comedy revue matter so much? The answer
lies in the evanescent nature of
choreography. Unlike music, it isn’t
written down (though dance steps
can be notated after the fact). Unless a concerted attempt is made
to preserve a dance, it vanishes
into thin air after its last performance—and surprisingly few attempts have been made to document the great Broadway dance
numbers. The dances from a handful of shows, most prominent
among them Agnes de Mille’s
“Oklahoma!” and Robbins’s own
“Fiddler on the Roof,” “The King
and I” and “West Side Story,” were
filmed as part of the screen versions and are now usually incorporated into their stage revivals.
Most of the rest, though, either
survive only in fragmentary form
or are completely lost.
“Jerome Robbins’ Broadway” actually began life in 1987 as an attempt by Robbins to resurrect
some of the dances from his other
shows. “I hated the idea that they
were just disappearing,” he said.
So he invited a group of aging
Broadway gypsies to help him reconstruct the “Bathing Beauty Ballet” dance, an homage to silentmovie slapstick comedy, from
“High Button Shoes.” The results
were so successful that he decided
to put together a full-evening retrospective that would give a new
generation of theatergoers “a taste
of the years I worked on Broadway.” To revive it now is—quite literally—a historic event.
Because the show and its rehearsals were videotaped, restaging the dances isn’t the biggest obstacle to staging it. It’s proved
even trickier to untangle the
knotty permissions problems—
from composers, lyricists, authors
and publishers—that were solved
on a one-time basis for the original
production but not adequately documented in 1989. “In the strictest
sense, the show didn’t ‘exist’ for licensing,” says Mike Isaacson, the
artistic director and executive producer of the Muny (that’s short for
“Municipal Opera”). “I’m assuming
Robbins and the producers figured
at the time that there wouldn’t really be a post-Broadway market for
it because of its size and scope.”
So why bother? Mr. Isaacson,
who is a true believer in “the fundamental greatness and power” of
the American musical, wanted to
do something spectacular to celebrate the Muny’s centennial. For
him, a full-scale revival of “Jerome
Robbins’ Broadway,” a kind of miniature history of the postwar
Broadway musical at its peak,
seemed like the best of all possible
salutes. “It felt really necessary for
me for the Muny’s 100th birthday,”
he says. “I’ve been telling people
that I want them to bring their kids
to ‘Jerome Robbins’ Broadway’ and
say, ‘This was what I lived. These
shows were the “Hamiltons” of
their day.’ Sure, it’s been hard, and
we’re not done yet. It’s all very Don
Quixote, I guess—but you know
what? Theater people love heading
toward a good windmill.”
The Muny’s revival isn’t the only
tribute to Robbins’s theatrical
dances in the works. Since 2018 is
also the centennial of the choreographer’s birth, New York City Ballet, Robbins’s longtime institutional home, has invited Warren
Carlyle, who made the dances for
the Broadway revival of “Hello,
Dolly!” and the 2016 revival of
“She Loves Me,” to stage a tribute
to his work on Broadway that will
have its premiere at the company’s
spring gala on May 3. I’ll be
there—but you can also plan on
meeting me in St. Louis when the
curtain goes up on “Jerome Robbins’ Broadway” for the first time
in 27 years. I might even go twice.
WSJ TALK / E XPERIENCE / OFFE R / GE TAWAY
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THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | A13
LIFE & ARTS
THE MIDDLE SEAT | By Scott McCartney
A Secret Restaurant in Terminal C
Why United Airlines has quietly opened an unmarked, invitation-only eatery at Newark Liberty International Airport
Speakeasy
Style
Classified is a
semi-secret
restaurant hidden
inside Newark’s
airport.
Hiding in
Plain Sight
Its main entrance
is an unmarked
door in the rear of
a public restaurant.
It’s Still the
Airport
FROM TOP: MICHAEL NAGLE FOR THE WALL STREET JOURNAL (5); CAITLIN OCHS/BLOOMBERG NEWS
Newark, N.J.
YOU’RE A TOP-DOLLAR FLIER.
Would you fly an airline more if it
secreted you into a speakeasy-like
restaurant hidden in a back corner
of the airport—and handed you
the bill?
United Airlines is betting you
might. United and airport concessionaire OTG Experience have
opened an invitation-only restaurant inside Newark Liberty International. To pump up the air of exclusivity, there are no signs for
Classified: It’s behind an unmarked
blue door in the back of another
restaurant in Terminal C.
The competition for premium
passengers increasingly has moved
out of the airplane cabin and into
the airport. In the air, most airlines have similar offerings in the
front of big planes—lie-flat seats
are just about universal, fancy
meals are the norm in business
class and first class.
But on the ground, airlines can
one-up rivals. They chauffeur toptier passengers between flights in
Porsche, Cadillac and MercedesBenz cars, or ply expensive-ticket
buyers with stylish clubs offering
showers, buffets, haircuts and
massages. American Airlines has
joined international carriers in
creating complimentary sit-down
menu dining rooms with gourmet
burgers and watermelon and feta
cheese salad for select first-class
customers at major hubs.
“That time between security
and the jet bridge is really time to
win a customer,” says Rick Blatstein, OTG’s chief executive.
United is building a lounge
with buffet food in Newark for its
business-class passengers, keeping pace with rival carriers. But it
believes its sort-of-secret restaurant raises the ante. Classified
can entice premium passengers to
fly out of Newark rather than
Kennedy or LaGuardia, says
Praveen Sharma, United’s vice
president of loyalty, merchandising and digital channels.
Classified’s 36 seats are in the
back of Saison, a French bistro in
Terminal C. If you have a reservation, you’re met in front of Saison
and escorted back.
It’s different from airport
lounges and clubs—no complimentary food or drinks. But it’s similar, since United controls access.
The airline won’t say how it decides which customers get invitations. It’s not all about frequentflier status or fare paid. Long
layovers may increase your chances.
CEOs and celebrities get invites.
United officials can walk-in VIPs or
even angry customers left stranded
by flight problems. And travelers in
the know are unlikely to be turned
away if they walk up and there’s an
open table, executives say.
OTG says Classified is designed
to resemble a high-end Manhattan
restaurant befitting its $100 42ounce Tomahawk rib-eye steak,
150-bottle wine list and wellstocked bar. A half-ounce shot of
Pappy Van Winkle bourbon costs
$40. A machine prints logos and
pictures on the foam of cappuccino, using coffee extract.
The menu was designed in part
by Marc Forgione, who shares
some signature dishes from his
eponymous Tribeca restaurant
Tables have iPads
for ordering and
credit-card swipes
for paying.
A New Flame
such as a chili lobster with Texas
toast. (It’s listed as an appetizer
but can be a full meal. It’s quite
tasty.) Another favorite: a delicious fried chicken sandwich on an
everything biscuit from Mr. Forgione’s American Cut steakhouse.
The chicken is marinated in buttermilk batter overnight.
Mr. Blatstein says steaks have
been the most popular so far. Classified uses a designated area of
Saison’s kitchen, and a few menu
offerings overlap.
Try as it might to be swank,
Classified remains an airport res-
Steak is the most
popular entree at
Classified. It also
offers chili lobster
wtih Texas toast.
taurant. The knives are
plastic, per TSA regulations. (Mr. Blatstein
notes the dry-aged
steaks must be tender to be cut
with plastic knives.)
The tables all have iPads for ordering—OTG uses them at all its
restaurants. There are power
ports and credit card swipe machines on tabletops and a luggage
rack being installed to declutter
seating areas.
Using United’s Chase credit card
scores a 20% discount, or you can
pay with miles, just as with OTG’s
other eateries in the
terminal. A $20 Caesar
salad costs 1,960 miles.
Comments are mixed
on frequent-flier forums like FlyerTalk. Some road warriors like it.
Others find the food overpriced
and the seemingly random invitations annoying. (Mr. Blatstein insists OTG checks and matches
street pricing. United says it is
aware of possible frustration with
invitation unpredictability.)
Asuka Nakamura, a high-status
United frequent flier from Manhattan, thought Classified didn’t live
up to the marketing buzz of an exclusive experience when he had
dinner there in early October.
He tried Classified before a latenight flight to Chicago for the city’s
marathon. He wanted a proteinheavy meal, but found the steaks
too large. He ordered a hamburger,
plus a cocktail that tasted so bad
he sent it back to be remade.
“The food was pretty average,”
he says. “I enjoyed the privacy.
That’s one of the benefits—you
can get away from the hubbub of
the terminal a little bit. It’s quiet
and secluded.”
ADVERTISEMENT
American Airlines
Also Ramps Up
Luxury on the Ground
United isn’t the only U.S. airline trying
to make downtime at the airport more
memorable. American now has Flagship
First white-tablecloth restaurants open
only to people who buy first-class tickets
for international or New York-Los Angeles
and New York-San Francisco flights. The
New York dining room opened in May. Miami and Los Angeles will open this year.
“It’s for that small, small percentage of
customers that generates a disproportionate amount of revenue,” says Kurt Stache,
American’s senior vice president for marketing, loyalty and sales.
U.S. carriers are still playing catch-up to
foreign airlines and airports. Lufthansa has
operated a separate first-class terminal in
Frankfurt for more than a decade, with a
sit-down restaurant and private baths
with collectible rubber ducks. Emirates’s
massive first-class lounge in Dubai has a
cigar bar, private duty-free shopping and a
spa. The Virgin Atlantic Clubhouse in London offers haircuts along with table-service dining. Singapore Airlines has a private restaurant at Changi Airport open
only to passengers who pay for first-class
suites on A380 flights, which can cost
$15,000 or more.
American, the last U.S. airline with
both business-class and first-class seats
Leisure Travel
To advertise: 800-366-3975 or WSJ.com/classifieds
FRANCE
Customers sit inside the American Airlines Flagship First dining room at New York’s
John F. Kennedy Airport.
on international flights, has the added
challenge of giving first-class passengers
reasons to buy up from business-class. In
the air, first-class customers get marginal
advantages like added space and privacy.
But they pay significantly more. A roundtrip between New York and London on
American might be $9,000 in business
class but $15,000 in first class.
Thus, Flagship First dining is for those
top few customers. “We want to create
certain experiences based on which product you purchased,” Mr. Stache says.
—Scott McCartney.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
A14 | Thursday, October 19, 2017
SPORTS
FOOTBALL
NFL Declines to Change Anthem Policy
Despite rising pressure from sponsors and the president, the league will continue to allow players to kneel for the anthem
BY ANDREW BEATON
THE National Football League on
Wednesday revealed its strategy
for managing the festering controversy over national-anthem protests: run out the clock.
Despite mounting pressure from
sponsors, fans and the president,
the league decided not to change
its rules in a way that would penalize the protests, in effect betting that the issue will quietly die
down on its own.
“The rules are fine the way they
are,” said Jacksonville Jaguars
owner Shad Khan, who added that
forcing players to stand during the
anthem wouldn’t be “appropriate.”
Coming as the league nears the
midpoint of the season, the decision
to stand pat marks a victory for
players—who have argued they are
within their rights to peacefully
protest and draw attention to issues
important to them—but virtually
ensures that the controversy will
linger for the foreseeable future.
Continuing a line of attack that he
has pressed for weeks, President
Donald Trump expressed his displeasure with the league’s inaction.
“@NFL: Too much talk, not
enough action. Stand for the national anthem,” he tweeted Wednesday afternoon.
In meetings Tuesday and
Wednesday in New York,
owners and league officials
tried to find language that
would mollify angry fans
and sponsors but stop short
of alienating the players.
NFL commissioner Roger
Goodell reiterated that he
believes “everyone should
stand for the national anthem” and noted that it’s
only “about half a dozen
players who are protesting,”though that doesn’t take
into account the other players who have demonstrated
in some other fashion. That
figure has fluctuated from
week to week. Goodell, who
said he hasn’t communicated
with the president on this topic,
said the league and the players had
productive discussions this week
about the racial and social issues
that spurred the anthem protests.
“We believe doing the right
thing is what you ultimately have
to do,” Goodell said. “Listening to
our players, understanding our
players, trying to address those
underlying issues and making our
communities better is where the
real opportunity is.”
Nevertheless, the issue is a
source of continuing aggravation
for league sponsors, who spend billions of dollars to be associated
with the country’s most popular
sport, which has long appealed to a
Above, some 49ers players kneel during the national anthem before an
Oct. 15 game. Left, Cowboys owner Jerry Jones at the owners meeting.
erates more than 100 retail
franchises selling athletic
merchandise, has seen revenues dip 20% in some markets, though others have remained steady. In one
Arizona store, NFL player
jersey sales in weeks one
and two of the season were
flat, compared to 2016, and
ended the month of September down 54% after the controversy erupted. In multiple instances, fans have
confronted salespeople in
the stores to complain about
T-B: ALEX BRANDON/ASSOCIATED PRESS; BRENDAN MCDERMID/REUTERS
the NFL protests, he said.
broad and appealing demographic
it’s an honor to stand during the naJed York, CEO of the San Franbut is increasingly polarizing. While tional anthem,” a spokesman said.
cisco 49ers, said the underlying issome sponsors have said they supThe issue is particularly fraught
sues that the owners and players
port the players’ right to protest, at
for USAA, which specializes in servdiscussed are “more important
least some are losing patience.
ing military members and their fam- than economics” and that “our
A spokesman for candy and gum ilies. The company’s message boards country is more important than a
giant Mars Inc. said that the comare littered with comments from
slight economic impact.”
pany isn’t taking a side on the iscustomers angry about USAA’s conLike others at the meetings,
sue, but wanted the NFL to resolve
tinued affiliation with the NFL, with
New York Giants co-owner Steve
it. In a statement, the company
many saying they are considering
Tisch noted that the number of
said it was “encouraged to hear
moving their business elsewhere.
players protesting has gotten
about the positive and productive
Other smaller businesses say they smaller. Regarding the communicadialogue between the league and
are seeing increasing blowback from tion with sponsors, he said,
players” this week.
fans angry about the protests.“The
“Pretty simply stated, they’re beLikewise, financial services giant
vitriol that the common fan has
ing told this will be okay.”
USAA said it has been in regular
over this issue is real,” said Ben De
Still, the league has made no secontact with the league on this topic Voe, the director of franchise develcret of its desire to move past this
in recent weeks. “We’ve communiopment for Pro Image Sports.
dispute. Goodell in a memo to
cated with the NFL that we believe
De Voe said his firm, which opteam owners and executives last
Weather
The WSJ Daily Crossword | Edited by Mike Shenk
Shown are today’s noon positions of weather systems and precipitation. Temperature bands are highs for the day.
40s
40s
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<0
50s
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garyy
Calgary
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Edmonton
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Boise
60s
Mpls./St.
p s /St.
pls
/ Paul
80s
Reno
80s
Cheyenne
70s
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San
n Francisco
i
LLas
Vegas
Vega
90s
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Omaha
Denver
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Albuque
b
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Albuquerque
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hil d lphi
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l d
U.S. Forecasts
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Lo W
55 s
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54 48 r
59 48 c
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80s
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3 Kia cars
19
4 Retreats
23
6 Boarding building
28
7 Rich from old
movies
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Warm
Rain
Cold
T-storms
46
42
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City
Frankfurt
Geneva
Havana
Hong Kong
Istanbul
Jakarta
Jerusalem
Johannesburg
London
Madrid
Manila
Melbourne
Mexico City
Milan
Moscow
Mumbai
Paris
Rio de Janeiro
Riyadh
Rome
San Juan
Seoul
Shanghai
Singapore
Sydney
Taipei
Tokyo
Toronto
Vancouver
Warsaw
Zurich
Hi
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42 Spot for
Quasimodo
43 Mars: Prefix
10 Game with
many balls
49
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55
44 Fingerprint
feature
11 Ready for
trimming,
as a sail
45 Long in the Pro
Football Hall of
Fame
Stationary
Snow
58
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12 Lilac’s cousin
Showers
Flurries
61
62
63
13 Aunt in August
Wilson’s
“Pittsburgh
Cycle” plays
Today
Lo W
48 pc
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86 73 t
85 71 s
70 57 s
91 77 t
77 57 s
83 58 t
59 52 pc
72 55 s
89 80 c
62 50 c
74 54 pc
70 53 pc
44 33 pc
90 79 s
62 52 pc
86 70 s
95 68 s
73 52 pc
87 78 s
70 52 s
71 60 pc
91 78 c
69 58 r
78 71 r
66 63 r
69 47 s
53 41 sh
63 47 pc
68 48 sh
CONTORTIONS | By Morton J. Mendelson
Across
1 Stick figure?
5 Take ___ (go
swimming)
9 Hold responsible
14 Victims of the
Beaver Wars
15 Farmiga of
“Bates Motel”
16 Teensy bits
17 •Candle shaped
like a big cat?
19 Parade
20 “Let everyone
know!”
21 Working
22 •Embarrassing
mistake on “The
Daily Show”?
24 Rod
28 Bad singer?
50 Hulled corn
29 Like some indie
films
51 Present
time?
30 Communicate
(with)
56 Due
36 •Equipment for
a reaper who
also takes in
laundry?
57 Contortionist,
e.g., and, read
syllable by
syllable, a hint
to the starred
answers
39 Attribute of
poet’s lines/
Whose final
words are not
quite rhymes
60 “Heavens!”
40 One who
succeeds?
61 Purchase
alternative
41 Frequent
undoing of
Wile E. Coyote
62 Steamy
42 They go low
Down
1 Spot
announcement?
44 •“Look at that
car part!”?
58 Star in Orion
59 Vat user
63 Playdate
participants
Solve this puzzle online and discuss it at WSJ.com/Puzzles.
35 His partner
37 Snarl
9 Latte
accompaniers
43
34 Muse of history
38 Shared with, to
get an opinion on
8 Good thing to
shoot
38
40
45
33 They’re picked in
Hawaii
5 Gamer’s
surrogate
39
44
32 “I Ain’t Marching
Anymore” singer
Phil
2 Puccini piece
16
21
22
s
City
Amsterdam
Athens
Baghdad
Bangkok
Beijing
Berlin
Brussels
Buenos Aires
Dubai
Dublin
Edinburgh
6
20
29
Ice
City
Omaha
Orlando
Philadelphia
Phoenix
Pittsburgh
Portland, Maine
Portland, Ore.
Sacramento
St. Louis
Salt Lake City
San Francisco
Santa Fe
Seattle
Sioux Falls
Wash., D.C.
5
15
41
70s
s...sunny; pc... partly cloudy; c...cloudy; sh...showers;
t...t’storms; r...rain; sf...snow flurries; sn...snow; i...ice
Today
Tomorrow
City
Hi Lo W Hi Lo W
Anchorage
34 19 s
31 22 s
Atlanta
74 50 s
79 53 pc
Austin
83 66 pc 83 67 t
Baltimore
73 49 s
75 48 s
Boise
73 48 pc 56 35 r
Boston
72 55 s
68 50 s
Burlington
72 47 pc 63 44 s
Charlotte
75 45 s
80 49 s
Chicago
71 51 s
77 59 pc
Cleveland
73 49 s
73 54 s
Dallas
84 64 pc 84 68 pc
Denver
76 47 s
80 40 s
Detroit
72 44 s
70 53 s
Honolulu
87 77 pc 87 76 pc
Houston
85 65 pc 82 69 t
Indianapolis
73 51 s
76 53 pc
Kansas City
77 56 s
75 61 s
Las Vegas
88 64 s
80 56 c
Little Rock
80 51 s
80 60 pc
Los Angeles
78 63 pc 76 59 pc
Miami
89 78 pc 88 80 pc
Milwaukee
69 51 s
74 58 pc
Minneapolis
71 54 s
75 59 s
Nashville
76 46 s
79 52 pc
New Orleans
83 68 s
83 72 pc
New York City
72 57 s
72 54 s
Oklahoma City
78 58 pc 77 64 s
4
Tampa
Miami
80s
3
17
70s
100+
Jacksonville
bil
Mobile
2
90s
80s
an Antonio
San
Honolulu
Pittsburgh
Pitts
b h
Washington
hington
h
gton D.C.
DC
New
ew Orleans
80s
Detroit
Cleveland
Indianapolis
50s
60s
Hartford
rtford
New
Yorkk
ew Y
Buffalo
ff l
Topeka
A
ti
Austin
40s
50s
Chicago
h
es Moines
Des
El P
Paso
0s
10s
20s
Anchorage
A h g 30s
Anc
k
Milwaukee
Kansas Springfield
City
C
h l t
Charleston
h
d
Richmond
St.. Louis
LLouisville
Lou
ill
l igh
h
Raleigh
hit
Wichita
Charlotte
C
h l tt
h ill
Memphis
phi Nashville
C
b
Columbia
kl homa
oma C
Cit
Oklahoma
Cityy
Atlanta
Atl
t
LLittlee Rockk
i
h
Birmingham
Dallas
D ll
Jack
Jackson
F
t.. Worth
Wor
Ft.
80s
Colorado
Springs
Angeles
Los A
Ange
San Diego
70s
Salt LLake
ake City
Sacramento
oux FFalls
ll
Pierre Sioux
30s
1
14
40s
g t
ttawa
Ottawa
70s AAugusta
T
t
Toronto
A
b y Boston
ban
Albany
t
Bismarckk
50s
20s
t
Montreal
60s
l
Helena
Portland
P
d
Eugen
Eugene
10s
60s
ip
Winnipeg
Seattle
week wrote that the issue is
“threatening to erode the unifying
power of our game.”
The root of any potential change
would have been in the NFL’s manual on game operations, which
states that players “should” stand
for the anthem. But unlike other
things that are expressly mandated
and required with the word “must,”
the “should” language echoes the
league’s sentiment that while it
wishes players would stand, they
are not forced to do so and won’t
face penalties if they kneel or sit.
Any decision to change that rule
would have likely inflamed an already tense relationship with the
players, who are engaged in highprofile disputes of their own with
the league. In court, the fight over
Ezekiel Elliott’s suspension for alleged domestic violence is continuing in what amounts to a broader
legal battle about Goodell’s authority and the NFL’s investigative processes. And on Sunday, Colin Kaepernick—the former 49ers
quarterback who began the national-anthem protests a year ago—
filed a grievance against the NFL
and its 32 teams, alleging they have
colluded to keep him unsigned because of his outspoken social views.
—Leslie Scism and Annie Gasparro
contributed to this article.
18 Flooring option
21 King and others
46 Friendly
muchacha
47 Trident trio
48 “I bet!”
49 Cheer
competition
23 Union member? 52 Jogger’s gait
24 “You’re so funny!” 53 “As I see it,”
online
25 Eon divisions
54 Bad impression
26 Mall fixtures
55 Asteroid visited
27 Looks for books,
by the NEAR
e.g.
Shoemaker
30 Talk of Tanzania
probe
31 Business letter
abbr.
57 They liaise with
the FBI
Previous Puzzle’s Solution
S E X P
S M I R
A P I E
P
I T S A
Q U A R
U R G E
I B A R
T O N
K
A T H E
Q U I T
A L D O
B I E N
A P S E
O
C
C
U
L
T
S
H
I
N
E
T
J
H
E
E
D
B L I
I E
Z A N
A
S I
G T V
L L E
A
R U S
E M T
A P E
T S P
F
D
I
C
K
U
M
Q
U
D A
N T
C
R Q
N U
S I
C
H
E
G
O
G
U I
N R
L L
I
TW
H
U A
T T
A N
H O
A T
N S
A
D
O
R
E
L
O
O
K
S
E
R
N
S
T
R
E
A
I
R
A
R
U
L
E
J
E
S
S
E
O S Y
R E D
U E S
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | A15
OPINION
Generation Y Takes Over
Why would
anyone turn
over the future of their
country to a
31-year-old?
To which the
WONDER
world’s
31LAND
year-olds
By Daniel
might reply:
Henninger
Why would
anyone turn
over the future of their country to somebody in his 70s?
You can’t leave Donald Trump
out of anything these days, but
the volatile septuagenarian’s
victory looks like one last baby
boomer swimming against the
global tides.
Austria on Sunday voted to
make its 31-year-old foreign
minister Sebastian Kurz the
country’s next prime minister.
National leadership hasn’t
seen anyone this baby-faced
since the age of hereditary
monarchies.
France’s president, Emmanuel Macron, is 39. Ireland’s
new prime minister, Leo Varadkar, is 38. Estonian PM Jüri
Ratas is 39, and Canada’s Justin
Trudeau is 45 going on 29.
It’s possible that Generation
Y’s rise to power is merely a
statistical anomaly, but I doubt
it. Many of the world’s democratic electorates are itching
for change, and the fastest way
to scratch that itch is to drop
down a generation for new
leadership.
It’s hard to blame voters for
playing the youth card. The
world’s smartest marketers
have decided that everything
else is in the hands of millennials, though fortunately no
one yet has proposed letting a
19-year-old run a country from
an iPhone screen. (The 19year-olds might ask what running a nation from a Twitter
account has to do with defining the age of reason.)
From the U.S. in 2016 to
Austria this week, there’s a
one-word default explanation
for these results: immigration.
Yes, but.
Yes, elites in power mishandled inflows of immigrants and
refugees. They underestimated
or ignored the challenges of
assimilation, made clear in a
thoughtful recent article in
this newspaper headlined:
“German Towns Filled With
Refugees Ask, ‘Who Is Integrating Whom?’ ”
But immigration is a subset
of a larger global problem. The
dominant economic event of
our era is the Great Recession,
which began in 2007 and
ended for the U.S. in 2009. Its
status as a “great” economic
downturn is attributed to its
long aftermath of unemployment and, more important,
underemployment.
As the U.S. and European
economies failed to achieve
pre-recession growth levels,
which exacerbated social anxieties, the elites produced an
explanation. They called it
“the new normal.”
The U.S. Bureau of Labor
Statistics offered a bloodless
explanation of the new normal
in December 2013: “Moving
forward, there are reasons to
believe that growth will continue to be slower than originally hoped.” Indeed, “Looking
forward to 2022, the U.S. Bureau of Labor Statistics expects slower GDP growth to
become the ‘new normal.’ ”
For the U.S., this meant the
postwar growth average of
about 3% was dead, and a 2%
average, at best, would be the
norm. Europe’s growth would
be marginally lower.
The “new normal” theory,
which in a wink became conventional wisdom among conventional economists and pundits, exists mainly to absolve
them—and Barack Obama—of
responsibility for weaker
growth’s dire effects on national standards of living.
What the theory failed to capture is that the new normal
creates angry have-nots.
Why would anyone
turn over the future
of their country to a
31-year-old leader?
Voters everywhere are rebelling against the new normal. They won’t concede its
implicit acceptance of flattened opportunities for younger Americans or Europeans
still in their prime working
years, who don’t have sinecures explaining to everyone
else why this is as good as it
will ever get. Increasingly, they
are voting into office political
outliers—from Trump to Macron to Kurz.
Mr. Macron is trying to revive the long-forgotten French
word “entrepreneur” and
pushing past-due labor reforms. Mr. Kurz, a tax cutter,
has proposed relief from Austria’s conventional European
social compact of stiflingly
high tax rates in return for a
somnambulant welfare state.
Mr. Trudeau’s economic
plan should be seen as a proxy
for what the next Democratic
presidential nominee is likely
to run on. Influenced by former Obama economic adviser
Larry Summers’s theories on
“secular stagnation,” Mr.
Trudeau is making massive
outlays on infrastructure repair and modernization to revive demand inside Canada.
Mr. Summers attributed the
Trudeau victory in 2015 to his
promised blitz of infrastructure spending.
Donald Trump is an infrastructure guy, too, but his path
out of the new normal’s longterm trap runs mainly through
regulatory relief and reforming
the U.S. tax system.
In an important speech, recently, Mr. Trump’s economic
adviser Kevin Hassett explained the administration’s
belief that fixing tax incentives
can deliver growth and
personal incomes higher than
the new normal’s lowered
horizons.
In 2016, for instance, U.S.
firms kept 71% of their foreignearned profits abroad, “benefiting other nations’ workers.”
What would be the effect, Mr.
Hassett asked, if for the next
eight years, those profits were
repatriated and reinvested here
through a tax regime designed
to promote more capital investment in the domestic economy? Incomes would rise.
There is good news after all.
Whether nations are placing
their bets with a 31-year-old or
a 71-year-old, voters are refusing to live with the anxieties
and dangers of a low-growth
status quo.
Write henninger@wsj.com.
Steve Bannon’s Motley Crew of Challengers
By Karl Rove
S
teve Bannon, the failed
presidential adviser and
alt-right sympathizer,
has declared war on incumbent Republicans, particularly
Sen. Mitch McConnell. From
his perch at Breitbart, Mr.
Bannon is vowing to defeat officeholders who back Mr.
McConnell as majority leader
or who won’t sign onto Mr.
Bannon’s populist agenda. So
what kind of challengers is
Mr. Bannon marshaling for the
midterms?
The first House candidate
Mr. Bannon has blessed is former Rep. Michael Grimm, who
was forced to resign his New
York seat in 2015 after pleading guilty to tax fraud. Recently
released after seven months in
the federal pen, Mr. Grimm will
challenge his successor, Rep.
Dan Donovan. Presumably Mr.
Grimm won’t campaign in his
orange prison jumpsuit.
Mr. Bannon has also tried recruiting his first gubernatorial
candidate: Colorado’s former
Rep. Tom Tancredo, a nativist
who once said President Obama
was “a more serious threat to
America than al Qaeda,” who
routinely attacks immigrants
for turning America into a
“Third World country,” and
who earlier this year accepted a
speaking invitation from a
white-nationalist group.
Mr. Bannon is also throwing
support to upstart Senate
challengers. In Nevada, where
Sen. Dean Heller is up for reelection, Mr. Bannon supports
Danny Tarkanian, a perennial
candidate who has lost five
races for four different state
and federal offices. Mr. Tarkanian’s sixth time is unlikely to
be the charm.
On Tuesday Mr. Bannon was
in Arizona campaigning for
Kelli Ward against Sen. Jeff
Flake. As a state senator, Ms.
Ward held a June 2014 town
hall to explore the claim that
One is fresh out of
prison. Another held
a town hall to discuss
‘chemtrail’ theories.
jet contrails are really chemicals sprayed by the government for weather, mind or
population control. She later
expressed no regrets about
hosting this conspiracy confab,
saying elected officials are
supposed to “listen to the people” and “get them the information that they need to feel
confident that they live in a
safe environment.” Ms. Ward
has praised Edward Snowden,
who fled the U.S. in 2013 and
has been charged with espionage. She supports eliminating
the Patriot Act, which provides
vital tools to combat Islamic
terrorism.
In Wyoming, Mr. Bannon is
recruiting Erik Prince, founder
of the security firm Blackwater, to challenge Sen. John
Barrasso. Mr. Prince was born
in Michigan and keeps a second home in Virginia. But he
and his family have lived in
Abu Dhabi since 2010.
He now runs Frontier Services Group, a security company financed by a Chinese
state-owned conglomerate and
hired to protect Chinese energy projects in Africa. He is
scouting Wyoming real estate
and trying to score a local
driver’s license, but no one
from Abu Dhabi has ever been
elected in Wyoming.
In open seats or races with
Democratic incumbents, Mr.
Bannon is backing consensus
mainstream candidates: Missouri Attorney General Josh
Hawley (whom Mr. McConnell
and I helped recruit); Tennessee Rep. Marsha Blackburn;
Ohio Treasurer Josh Mandel
(on whose 2012 Senate bid
American Crossroads spent
millions).
Mr. Bannon justifies his jihad against incumbent Republicans by claiming that they
“do not want Donald Trump’s
populist, economic nationalist
agenda to be implemented.”
That’s nonsense. Keep in mind
that after being forced out of
the White House in August,
Mr. Bannon declared that “the
Trump presidency that we
fought for, and won, is over.”
He also attacked Mr. Trump’s
policy toward North Korea
and criticized the president’s
support for a bill that would
keep the “Dreamers” from being deported.
Furthermore, Nate Silver’s
Five Thirty Eight reports that
six of the seven Republican senators seeking re-election next
year have voted with the president’s position more than 90%
of the time. So has every member of the Senate leadership.
Mr. McConnell and Mr. Barrasso both have sided with the
White House 96% of the time.
The figure for Texas Sen. Ted
Cruz is only 94%, yet Mr. Bannon deems him acceptable.
It will be more than a year
before the curtain closes on
Mr. Bannon’s script for a Republican Götterdämmerung.
But his first test is Alabama’s
Dec. 12 special election for the
Senate. Mr. Bannon’s pick, Roy
Moore, leads Democrat Doug
Jones by a mere 4.4 points in
the Real Clear Politics polling
average. Over the past two decades, the typical margin for
an Alabama Republican running statewide is about 23
points.
While still favored to win,
Mr. Moore’s margin will be the
first evidence of whether Mr.
Bannon has picked a team of
winners or just a collection of
misfits and ne’er-do-wells.
A
century ago, colleges
cared if your ancestors
came over on the Mayflower. Now some are demanding that when universities admit black students,
they give preference to descendants of those who arrived on slave ships. Black
Students United at Cornell
last month insisted the university “come up with a plan
to actively increase the presence of underrepresented
Black students.” The group
noted, “We define underrepresented Black students as Black
Americans who have several
generations (more than two)
in this country.”
After widespread criticism—including a student oped with the headline “Combating White Supremacy Should
Not Entail Throwing Other
Black Students Under the
Bus”—the group backtracked,
sort of. It apologized for “any
conflicting feelings this demand may have garnered from
the communities we represent.” But if the purpose of
racial preferences is to promote “diversity,” as the Supreme Court has held, why
don’t immigrants count?
The BSU argued that “the
Black student population at
Cornell disproportionately
represents international or
A radical group calls
on the university to
disfavor immigrants.
first-generation African or
Caribbean students. While
these students have a right
to flourish at Cornell, there
is a lack of investment in
Black students whose families were affected directly by
the African Holocaust in
America.”
There’s a contradiction
here. For years liberal writers
have blamed black poverty
and undereducation on racism—the experience of being
more likely to be pulled over
by police, to be looked at
suspiciously in department
stores, to be discriminated
against in schools and the
workplace.
But it doesn’t seem to be
the case, at least not to the
same degree, among immigrants. “The more strongly
black immigrant students
identify with their specific
ethnic origins, the better
they perform [academically],”
Amy Chua and Jed Rubenfeld
observed in their 2014 book,
“The Triple Package.”
Anecdotal examples are
easy to find. The website
Face2FaceAfrica noted in April
that Ifeoma White-Thorpe, a
New Jersey teen born in Nigeria, had joined “a remarkable
roll call of high-flying AfricanAmerican students who were
accepted into all 8 Ivy League
Universities.” Among them:
Ghanaian-American
Kwasi
Enin, Somali-American Munira
Khalif and Nigerian-Americans
Harold Ekeh and Augusta
Uwamanzu-Nna.
Lamenting
The Motherland
The Future Is History
By Masha Gessen
(Riverhead, 515 pages, $28)
R
ussia transfixes the American imagination like no other
country, and Moscow’s aggressive authoritarianism has
prompted divergent assessments of its causes. Some
see it as provoked by Western policies, whether supposedly
insufficient aid provided to Russia to overcome Communist
legacies in the 1990s or an unnecessarily confrontational
expansion of NATO. Others assign primary responsibility to
Russian president Vladimir Putin, pointing to either his lust
for power and empire or his pique and revanchism.
Masha Gessen, a Russian-American journalist, adopted the
second approach in “The Man Without a Face” (2012), which
portrayed the strongman as simultaneously lacking talent
and lording over all. In her new book, “The Future is History:
How Totalitarianism Reclaimed Russia,” she attempts to
reconcile this contradiction, now blaming what she calls Russia’s “totalitarian society.” Her parents fled the Soviet Union
with their children in 1981; Ms. Gessen, who had moved back
to Moscow 10 years later, fled Russia with her own children
in 2013, and here she crafts an indignant lamentation. “I have
been told many stories about Russia, and I have told a few
myself,” she observes, offering a tale of the “freedom that
was not embraced and democracy that was not desired.”
Ms. Gessen selects the lives
of four Russians born late in
the Soviet Union who came of
age in an era, initially, of hope.
They are “Seryozha” (Sergei
Yakovlev), the grandson of Alexander Yakovlev, one of the
shapers of Mikhail Gorbachev’s
liberalization; “Zhanna”
(Nemtsova), the daughter of Boris
Nemtsov, the former Russian reformist
official and subsequent democracy activist who
was gunned down near the Kremlin in 2015; “Masha” (Maria
Baronova), another democracy activist; and “Lyosha” (Alexei
Gorshkov), a gay gender-studies scholar in provincial Perm.
All are members of the urban liberal intelligentsia.
The author also folds in the stories of Marina Arutyunyan,
a psychoanalyst; Lev Gudkov, a sociologist who worked under
and then succeeded Yuri Levada as the head of the country’s
leading independent polling organization; and Alexander
Dugin, a ubiquitous ideologue of hardline Russian resurgence.
A fine writer and storyteller, Ms. Gessen adopts the pose of
omniscient narrator, drawing upon interviews to voice her subjects’ inner thoughts. The intricate narrative builds to Russia’s
2011 mass protests—which followed Mr. Putin’s declaration
that he would become president again—and the crackdown
that came the following year.
The author recounts the buried history of Ms.
Arutyunyan’s family, whose grandmother, Anna Pankratova,
a rare female member of the Communist Central Committee
from 1952 until her death in 1957, had earlier denounced her
husband as a Trotskyite.
Pankratova herself was expelled from the party in the
1930s, when her daughter Maya (Ms. Arutyunyan’s mother)
was about 10. After Maya died in 1999, Ms. Aruntyunyan
found Pankratova’s journals, which showed that she loved
the husband she betrayed for the party cause. The betrayal
today, Ms. Gessen implies, is carried out by the gray mass
of Russians against those who are willing to stand up to
the regime.
Examining the psyche of modern Russia,
through the eyes of those born at the end of the
Soviet era and who grew up at a time of hope.
Why does racism not seem
to keep black immigrants
down? The answer is obvious: Black immigrant culture
tends to value academic
achievement and believe it is
possible no matter what happened to your ancestors. As
one business school graduate
born to Nigerian parents
tells Ms. Chua and Mr.
Rubenfeld: “If you start
thinking about or becoming
absorbed in the mentality
that the whole system is
against us then you cannot
succeed.”
Groups like the Cornell
BSU insist that the system is
out to get them and they cannot succeed. This makes the
presence of high-achieving
immigrant black students inconvenient. Between diversity
and victimhood as the highest good in today’s academia,
it’s hard to know where to
place your money.
Her most incisive portrait involves the personal life and
professional agony of Lyosha Gorshkov. He wins a competition, sponsored by the Soros Open Society Foundation, to
participate in a multiyear project in Ukraine. “Ukraine, he
learned, had thirty-seven registered LGBT groups,” Ms.
Gessen writes. In Russia, by contrast, his scholarship is
criminalized, and his very existence threatened.
Even as Ms. Gessen poignantly traces compelling lives, her
account of Russian society as a whole puts forth a reductionist argument full of psychospeak about “energies” and an
entire society succumbing to depression. She begins with the
dubious assertion that one of Soviet society’s decisive troubles derived from the state prohibition against sociology and
psychoanalysis, which meant the society “had been forbidden
to know itself.” To this she adds Yuri Levada’s detailed sociological portrait, from polling, of “Homo Sovieticus,” a doublethinker bred by the system, who contrary to expectation did
not die out with the system. Yet none of the characters she
chose to follow in this book is a “Homo Sovieticus”—even
though that is the type she claims explains the staying power
of the Putin regime. This book about the alleged
indispensability of sociology abjures a representative sampling of individuals in favor of a contrived literary selection.
Ms. Gessen is right that ordinary Russians are to an extent
complicit in their own oppression, but is the society the part
that is totalitarian? “Maybe Freud was right about the death
drive in the first place,” she writes, speaking through the
interior thoughts of Ms. Arutyunyan. “And maybe a country
could indeed be affected by it just like a person could. Maybe
this energy had been unleashed in Russia. . . . This country
wanted to kill itself.” Ms. Gessen graphically details the gruesome murder of a man in Volgograd killed by his friends for
being gay. Russia’s parliament passes a ban on homosexual
“propaganda,” which she suggests is the centerpiece of the
regime’s cynical control strategy. She also notes that the
Levada Center found that 73 percent of Russians supported
the discriminatory law, but she does not examine the social
conservatism of the populace, only its manipulation.
Tens of millions of Russians are holding down jobs, raising
families, reading books and writing blogs, while living under
a dictatorship. A small, resolute number continue to protest,
including in what Ms. Gessen calls “the most geographically
widespread protest in Russian history” on the country’s
national holiday (June 12) in 2017. Meanwhile, Zhanna has
decamped to Bonn, where she works for the broadcaster
Deutsche Welle, Lyosha has obtained asylum in the U.S., and
Seryozha began to take antidepressants, developing a rare
side effect: toxic epidermal necrolysis. Masha Baronova
remains in Russia, among the ranks of democracy activists,
and has avoided prison—for now.
Ms. Riley is a senior fellow
at the Independent Women’s
Forum.
Mr. Kotkin, a professor at Princeton University and fellow
at Stanford’s Hoover Institution, is the author of “Stalin:
Waiting for Hitler, 1929-1941.”
Mr. Rove helped organize
the political-action committee
American Crossroads and is
the author of “The Triumph of
William McKinley” (Simon &
Schuster, 2015).
Cornell’s Black Student Disunion
By Naomi Schaefer Riley
BOOKSHELF | By Stephen Kotkin
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OPINION
H
REVIEW & OUTLOOK
LETTERS TO THE EDITOR
More Freedom for More Money
U.S. Health-Care Reform: First Do No Harm
ow does Washington define “biparti- don’t want or can’t afford ObamaCare’s other
san”? We are about to find out if it offerings. But one caveat: This provision won’t
means that Republicans surrender to take effect until plans for 2019, and a Demoeverything Democrats want,
cratic majority in Congress
Republicans should get might try to repeal it.
or if it means a genuine trade
of policy priorities in which more reform for reviving
Mr. Alexander deserves
both sides get something and
credit for trying to break
ObamaCare subsidies. through the brick wall known
the country benefits.
That’s the question to ask
as Senate Democrats, and the
about this week’s deal bedeal would at least make the
tween Republican Lamar Alexander and Demo- subsidy payments legal. Yet the reform is tepid
crat Patty Murray to appropriate two years of enough that it probably won’t do much to alter
funding for ObamaCare’s “cost-sharing” reduc- the ObamaCare trend of rising premiums and
tions that flow to insurers. The Trump Adminis- fewer insurance choices.
tration last week cut off these subsidies, which
This will make it unappealing to many Rethe Obama Administration paid without an ap- publicans, who promised repeal and replace in
propriation from Congress. A federal judge 2016 and will be asked to vote to retain and ratruled last year that those payments are illegal. ify. President Trump seemed to acknowledge as
Democrats would also get about $100 million much on Wednesday when he withdrew his
for advertising ObamaCare.
early support for Alexander-Murray and asked
In sum, Democrats get what they care most for more reform.
about in politics: More to spend. And the strucMr. Trump probably doesn’t know what he
ture of ObamaCare survives.
wants, but there are good ideas available. Sen.
The bait for Republicans is more flexibility Ron Johnson of Wisconsin has suggested exfor states, though the trouble is in the details. panding health-savings accounts and delaying
The Affordable Care Act’s Section 1332 waiver the employer mandate. The individual mandate
process in theory already allows states to de- has proven to be an ineffective incentive to buy
ploy federal money to experiment with innova- insurance and is unpopular besides. Why not
tions. In practice the stipulations are so strin- kill that too?
gent that waivers are mostly notional.
As Phil Gramm argues nearby, the point is
States seeking a waiver must offer plans that that Republicans should be fighting to give
provide coverage that is: at least as comprehen- Americans more choice about the health insursive in benefits as ObamaCare; at least as af- ance they can buy. Democrats will resist befordable; covers a comparable number of resi- cause the entire structure of ObamaCare dedents; and deficit neutral. In other words, pends on mandates and coercion. But more
Governors are free to try anything between freedom in return for more money and health
ObamaCare and single payer.
coverage is a fair political trade.
The Alexander deal would alter the affordDemocrats may think they can refuse to
ability language from “at least as” to “compara- budge beyond Alexander-Murray and blame Reble,” and if that sounds like a semantic distinc- publicans in 2018 for ObamaCare’s problems,
tion—well, you have a point. The practical but their predictions of apocalypse are overeffect would be to approve the not very ambi- blown. The GOP doesn’t want to own doubletious waivers that are now trapped in the appli- digit premium increases next year, though hikes
cation process.
are coming, deal or no deal, because the exPerhaps more states could create a reinsur- changes are suffering from adverse selection as
ance program that subsidizes the sick and thus consumers and insurers flee. But if House Relowers premiums for everyone, which Alaska is publicans pass a bill with more reform and Senrolling out with a 1332 waiver. Yet states can’t ate Democrats refuse to compromise, Democreate more consumer choice without the free- crats might own higher premiums.
dom to offer more choices in covered benefits.
By the way, if Congress stalls on appropriatThe deal streamlines the waiver application ing the money for cost-sharing subsidies, tax
process, which is useful but cosmetic.
credits for individuals will expand to cover the
Another plank is that individuals could pur- difference. In other words, low-income folks
chase “catastrophic” plans with high deduct- will be made whole.
ibles that insure against a major illness or acciRepublicans wouldn’t be in this political
dent. The Affordable Care Act only allows folks mess if they had passed some version of repeal
under age 30 or those with a financial hardship and replace. But if that can’t pass, then they
to purchase such plans. The new “copper plan” might as well call the Democrats’ bluff and drive
would be a good option for individuals who a genuinely bipartisan bargain.
L
Rand Paul’s Alternative Reality
ife must be tough for Rand Paul, living adding that “the budget vote to me is a symbol
in an alternative political reality all by and a guidepost as to what we are as a party
himself. After repeatedly obstructing re- and what we stand for.” But Mr. Paul’s goal of
forms to ObamaCare that
chopping defense isn’t shared
He’s willing to kill tax by most of his colleagues. So
would have reduced the size of
government, he is now oppos- reform so he can make a he’s threatening to block tax
ing a budget resolution that is
reform so he can make a futile
futile political gesture. political gesture.
essential for tax reform.
Mr. Paul said Tuesday that
His criticism of Messrs.
he’ll vote against the Senate
McCain and Graham as “false
budget outline because it includes $43 billion conservatives” may also explain his recent
in military funding that breaks Congress’s 2011 vote to kill Mr. Graham’s version of Obamaspending caps. “Senators [John] McCain and Care repeal. The biggest driver of federal
[Lindsey] Graham are torpedoing the budget by spending is entitlements, and legislation to
insisting on busting the budget caps for more block grant health-care funds to the states
spending,” he tweeted.
would have been the biggest entitlement reEnough with the warmongering, Rand. As form in decades.
even the Kentucky Senator acknowledged, the
Mr. Paul is deceiving voters and perhaps
budget is merely a vehicle for passing tax re- even himself by pretending that limiting deform with 51 Senate votes. The GOP budget is fense spending will balance the budget. This
“a document that represents are we for spend- will require faster growth that requires tax reing cuts, are we fiscally responsible,” he said, form. Who is the real political phony?
S
Stopping Sue and Settle
cott Pruitt continues to press reform at with litigious environmental groups have rethe Environmental Protection Agency, sulted in no fewer than 137 new Clean Air Act
this week issuing a directive to curb the regulations. The costs of several of these rules
collusive Washington game of
run well into the billions, inThe EPA moves to
“sue and settle” lawsuits. This
cluding some of the most exis a victory for democratic
pensive ever written.
limit extortion by
consent over legal extortion.
Mr. Pruitt’s directive says
environmental lawsuit. the EPA will no longer commit
For years green activists
have used sue and settle to imto specific policy outcomes in
pose policies they can’t get
its settlements or consent dethrough Congress. Their allies in the EPA would crees, instead agreeing only to review a rule or
invite lawsuits, then settle with the greens by provision. It will also require the EPA to proagreeing to implement some or all of their poli- vide vastly more opportunity for diverse public
cies in consent decrees. When citizens or busi- comment.
ness complained, EPA would claim its hands
Too often, bureaucrats and greens have been
were tied by the settlement.
the sole parties involved in sue-and-settle negoMr. Pruitt saw the abuses first-hand as Okla- tiations. That has meant no dissenting perspechoma’s attorney general, notably as the state tives and no representation for voters and conbattled over the EPA’s Regional Haze Plan. Un- sumers who pay for heavy-handed federal
der the Clean Air Act, states are supposed to de- regulation. Under the new directive, the EPA
velop programs to reduce emissions. Oklahoma will invite states and industries affected to
came up with a smart plan to do so at minimal weigh in. Proposed consent decrees and settlecost by replacing coal with natural gas.
ments will be open to public comment the way
But under a consent decree between the new or modified regulations are now.
EPA and green litigants, the federal governEnvironmental groups will also no longer be
ment prescribed a plan that required retrofit- considered the “prevailing party” when litigating six Oklahoma power plants with sulfur-di- tion does end in settlement. This is an immedioxide controls. The cost: $1.8 billion. Even as ate victory for taxpayers, given that green acthe state’s utility bills skyrocketed, “the result- tivists have used their prevailing party status
ing impact on regional haze would be practi- to get the EPA to reimburse them for millions
cally imperceptible,” Oklahoma Gas & Electric of dollars in legal fees.
concluded.
These are useful changes that will improve
The agency overrode 17 states’ regional haze transparency and lead to more honest policy.
programs after sue-and-settle agreements. In They are also a lesson to Congress that it needs
total, the Obama EPA imposed a record-break- to write environmental law with more precision
ing 55 federal implementation plans under the so the next EPA Administrator can’t easily reClean Air Act. And since 2009 EPA agreements vive sue and settle.
In “The Health Reform That Hasn’t
Been Tried” (op-ed, Oct. 4), Scott Atlas suggests a terrific solution to the
health-care mess created by ObamaCare—putting consumers in charge of
their health-care decisions and allowing market forces to drive down costs.
Members of both political parties have
bought the premise of Messrs. Jonathan Gruber and Ezekiel Emanuel, architects of ObamaCare, that the American public is too stupid to make
informed decisions; that Americans
are too ignorant to know what they
need and the only solution is to assure
them that Uncle Sam will always be
there to make their decisions for them
and to protect them from themselves.
How else can you explain the failure
of the Republicans to come to grips
with the essential problem that the
government is incapable of managing
health care?
STEPHEN W. REED
Pasadena, Calif.
through insurance contracts that lack
transparency? Further, how do you negotiate for physician services when
prices are fixed by generous fee
schedules and most doctors are incentivized to do more, not compete, in
our fee-for-service model.
How does the proposed reform provide the opportunity for medical care
for all our citizens, including those
with pre-existing conditions? Asserting that the proposed changes would
make health care less expensive and
somehow magically result in such low
premiums that everybody could afford
it is naive and unrealistic.
DAVID BERNHARDT, M.D.
San Luis Obispo, Calif.
Several years ago our office
switched our health-care plan in an effort to control rising costs. We
scrapped our traditional plan for a
catastrophic coverage plan ($5,000
out of pocket) and saved a considerable amount on premiums. We then
A few of the elements addressed in returned the savings to our employees
Mr. Atlas’s piece have been tried. For
as a monthly contribution to a healthexample, in 1984 the government of
savings account. The net result was
Singapore initiated Medisave, a manzero increase in cost and considerable
datory health-savings account compul- increase in flexibility for our worksory for all employees and the selfers.Unfortunately, this option has disemployed who are citizens or
appeared after legislation totally dispermanent residents. The contribution rupted the heath-care system, but
is 6%-8% a year. In 2003 the Ministry
limited successes like these deserve
of Health mandated that all hospitals
consideration as part of a larger picpublish all hospital charges on the
ture of reform.
Ministry of Health’s website, and this
ROBERT FASOLI, M.D.
Bradenton, Fla.
is updated every month.
A few common statistics reveal the
Scott Atlas forgets to mention that
success of the Singapore Healthcare
studies show those paying out of
System. Singapore spends 3.7% of its
GDP on health care. Life expectancy is pocket tend to postpone treatment,
creating more serious problems later
82 years and infant mortality is 2.3
and driving up the overall cost of
per 1,000 live births. Not too bad.
PETER A. STATTI, M.D. health care.
Santa Maria, Calif.
AUGUSTA ERA GOLIAN
Spring, Texas
Who pays for the health-savings acA free market exists in one aspect
counts for those without the means to
of health care: laser eye surgery. It’s
purchase them? How do empowered
generally not covered by insurance, so
consumers and patients use that
power if the rest of the system is basi- providers have to compete on quality
cally rigged to prevent price competi- and cost. The cost of laser surgery has
dropped from $2,200 per eye 20 years
tion? Specifically, how can anyone
ago to $250 per eye today, and proprice shop for drugs that have no alduces more patient satisfaction than
ternative, whether through patent
any other surgery.
protection or market collusion? How
SCOTT KAUFMANN
do consumers shop for hospital serKansas City, Kan.
vices that are artificially priced
ObamaCare Addressed Legitimate Problems
Offering “skinnier and cheaper private options” in health insurance defeats the whole premise of insurance
(“Trump Has Range of Options to
Chip Away at Health Law,” U.S. News,
Oct. 13). Shoddy plans filled with caveats and cleverly worded exclusions
was why the Affordable Care Act was
passed in the first place. As a certified employee-benefit specialist and
financial adviser advocating for my
employee constituents, I have had a
position on the front lines of this battle since 1985. The situation deteriorated until the passage of the ACA.
Not that the ACA was perfect, but it
was an important step. Finally, the
protections everyone needed were
codified into law. Why any responsible government would want to dismantle necessary protections defies
reason.
The fact remains that the quickest
way for a solid, two-income middle-
class family to fall into poverty is for
one family member to experience a
serious health incident with inadequate coverage. Insurance is supposed
to be assurance that when an unwelcome event happens, one will have
the funds to pay for the unexpected
expense. What President Trump and
the Republicans who support him are
doing may make people feel like they
are making progress, but it is a false
promise doomed to cause misery.
MARTHA L. CATT
Charlotte, N.C.
Private Sector Not the Only
Sector Involved in Growth
In “Tax Reform Will Give Workers
a Raise” (op-ed, Oct. 11) Lawrence B.
Lindsey suggests that the tax-reform
package working its way through
Congress “aims to address the reasons that the current economic recovery has been the most anemic on record.” But does it? The 2.1% growth
rate in the current recovery comprises a 3%-plus growth rate in the
Regarding the letters of Oct. 11 reprivate sector and a decline of about
sponding to Sam Liccardo’s “Why I’m
1% in the public sector. The decline in
Not Bidding for Amazon’s HQ” (op-ed, public spending and investment for
Oct. 5): Look at Greenville, S.C., and
the past eight years is unprecedented
BMW. There are 9,000 direct jobs and and remains a main drag on ecothousands more at the 40 suppliers
nomic growth. The answer to today’s
that followed BMW to South Carolina. economic growth conundrum lies in
The annual economic gain is $16.6 bil- designing a fiscal policy that prolion, according to the University of
motes growth through both private
South Carolina. BMW now manufacand public channels, and the best aptures over 400,000 vehicles a year in
proach would be a combination of tax
South Carolina. The company has inreform and public spending (infravested $7.8 billion in its manufacturing structure) initiatives.
facility. In this case, incentives paid off
JOSEPH CARSON
Westport, Conn.
many, many fold. In fact, this one deal
Mr. Carson is a former global diwas instrumental in turning around
rector of economic research for Allithe entire state.
FRANK SHIELDS anceBernstein.
Rocky Mount, N.C.
Relocation Incentives Aren’t
Always Dumb for Localities
A Nobel Peace Prize for Ayaan
Regarding “The Nobel Alternate-Reality Prize” (Oct. 7): The editorial ends
with an exhortation to the Nobel Committee to find better candidates to
“best help the cause of peace.”
May I suggest Ayaan Hirsi Ali. Each
year that goes by without her being
awarded the prize is another year of
cowardice and hypocrisy by the Nobel
Committee.
STEVE KOHN
San Antonio
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THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | A17
OPINION
By Phil Gramm
W
hile there is plenty of
blame to go around
for Republicans’ inability to repeal and
replace ObamaCare,
the effort was all but doomed as
soon as the GOP chose to fight on
the wrong battlefield. Trying to
pass a replacement through the
budget process known as reconciliation was powerfully attractive,
since it would have permitted the
Senate to act on ObamaCare with
only 51 votes.
As a precondition for any
bailout deal, families
should be permitted
to opt out of ObamaCare.
But under the Senate’s rules for
reconciliation, the debate was limited to actions that would directly
affect revenues and expenditures,
thereby forcing Republicans into an
argument about how much to spend
on ObamaCare beneficiaries.
Using reconciliation therefore
precluded Senate debate on meaningful changes in policy that could
have helped the millions of Americans harmed by ObamaCare. Since
the debate turned on spending instead of health-care freedom, Republicans lost.
To understand where ObamaCare
is vulnerable, first consider why
President Obama succeeded in collectivizing American health care
when President Clinton had failed.
So long as the debate over ClintonCare centered on new benefits,
support grew. At the high-water
mark in 1993-94, as many as 74
senators supported ClintonCare or
something very close to it. Concerns over cost and efficiency were
shrugged off. The proposal fell
apart only when Americans realized that ClintonCare would take
away their freedom, forcing them
into a system where government
would largely control their health
care.
Republicans might have forgotten that lesson, but Mr. Obama
didn’t. To prevent a debate about
coercion and lost freedom, he employed the most consequential lie in
the recent history of American governance: “No matter how we reform
health care, I intend to keep this
promise: If you like your doctor,
you’ll be able to keep your doctor;
if you like your health-care plan,
you’ll be able to keep your healthcare plan.” This calculated falsehood, repeated by every congressional Democrat, focused the debate
on providing new health-care benefits—and Democrats won.
Shortly after ObamaCare’s enactment, the nation discovered the
truth: Millions of Americans had
lost the freedom to choose their
doctors and insurance plans, while
many young and relatively healthy
families found themselves coerced
J. SCOTT APPLEWHITE/ASSOCIATED PRESS
Republicans, Stand Up for Health Freedom
Patty Murray and Lamar Alexander the day after announcing their deal.
into a collectivist program designed to exploit them. In 2010
they went to the polls and elected
a Republican House.
As rising premiums drowned out
more of ObamaCare’s massive subsidies, the number of Americans
who benefited from the law declined and the number hurt by it
increased. The surging number of
ObamaCare “losers” elected a Republican Senate in 2014 and helped
put Mr. Trump in office two years
later.
The Fed Chief America Needs
By George P. Shultz
And John F. Cogan
J
anet Yellen’s term as Federal
Reserve chair expires in February 2018, providing President
Trump with a unique opportunity
to reshape monetary policy and improve the economy’s growth trajectory. What should he look for in the
next chairman?
First, the president should seek
someone with a deep understanding
of the American economy’s dynamism—someone who appreciates its
capacity to grow and the important,
but circumscribed, role of monetary
The president should pick
someone who understands
that the economy can grow
more than 2% a year.
policy in contributing to growth
without inflation. Many observers
believe the U.S. economy can’t grow
much faster than the anemic 2% of
recent years. On the contrary, persistent stagnation is neither the experience of the past few decades
nor our immutable destiny.
With lower individual and business tax rates, less burdensome
regulations, federal spending restraint, and policies to better match
workers’ skills with labor market
needs, the U.S. economy can
achieve significantly faster longterm growth. Stunning advances in
technologies, such as in artificial
intelligence and 3-D printing, valueadded manufacturing and advanced
biosciences, will dramatically improve labor productivity and bolster future economic growth.
The next leader of the Fed must
recognize this potential for higher
productivity and be willing to establish a monetary policy that accommodates a faster-growing economy. He must not mistake morerapid economic growth for an
overheated, inflation-prone economy that needs cooling off. A Fed
that made such a mistake would
only perpetuate the slow-growth,
low-productivity, stagnant-wage
economy of the past decade.
Second, the Fed chief should be
able to lead the Federal Open Market Committee to a sound mediumterm strategy for noninflationary
economic growth. If economic fundamentals change, the chair must
be willing to make policy adjustments after consultation with the
board. The Fed chief needs to lead
a cohesive team with common
goals.
Fed governors and regional bank
presidents make too many speeches
these days, especially about actions
that should be taken at the next
meeting. Such short-termism undermines the institution’s purpose.
A good model for the Fed chairman
and governors comes from the
great baseball player Ted Williams.
When asked why he rarely spoke to
the press, Williams often replied
that he preferred to let his bat do
the talking.
Third, the Fed chairman should
be a steady hand in a time of economic turbulence. Although the
economy has underperformed
since the end of the Great Recession, it hasn’t experienced another
downturn. Such good fortune is
unlikely to last. The business and
financial cycles have not been repealed. External geopolitical and
economic events could adversely
affect the American economy. Part
of the Fed’s job is to minimize the
damage from recession. The president should find someone with the
credibility, temperament and track
record to respond when events
turn.
Fourth, a new Fed chairman
should recognize the central bank’s
proper relationship with the White
House and Congress. The Fed’s independence has been crucial to the
successful development and implementation of monetary policy. It
must be respected and preserved.
At the same time, the Fed must resist the temptation to become engaged in credit allocation and
quasi-fiscal policies that are properly the purview of the Treasury
and the people’s elected representatives in Congress.
President Trump should not underestimate the importance of the
Federal Reserve chairman to his
administration’s success. Ronald
Reagan recognized this in the early
1980s by strongly supporting
Chairman Paul Volcker’s efforts to
rid the economy of inflation. The
combination of the Fed’s sound
monetary policy and Reagan’s progrowth tax and deregulatory policies produced a remarkable legacy
of growth. The times are different,
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but the importance of the Fed to
the president’s success remains the
same.
Let’s have a Fed chief who understands the U.S. economy’s potential to grow, acts to reform the
institution and works to establish a
sound, pro-growth strategy.
Mr. Shultz, a former secretary of
the Treasury and state, is a distinguished fellow at Stanford University’s Hoover Institution. Mr. Cogan
is a senior fellow at Hoover and author of “The High Cost of Good Intentions,” published last month by
Stanford University Press.
Fulfilling the GOP’s mandate to
end ObamaCare, the House passed
a bill that would restore healthcare freedom, expand consumer
choice, and pass control of Medicaid and the exchange subsidies
back to the states. But then the bill
was sent over to the Senate, where
the parliamentarian dutifully enforced the rules of reconciliation.
Thus, all the significant policy reforms adopted by the House were
struck.
Republicans lost their most powerful issue in the health-care debate: giving Americans the freedom
to refuse to participate in ObamaCare. When Republicans tried to
put together a fallback plan under
the rules of reconciliation, the argument degenerated into a bidding
war. Republicans could not match
ObamaCare’s benefits without preserving ObamaCare’s taxes, coercion and endless commitment to
additional funding.
The GOP’s original strategy of
defunding ObamaCare via reconciliation—a bill to that end had previously passed Congress and been vetoed by President Obama—might
have been the first step toward
success. By first defunding ObamaCare, Republicans could have forced
a debate on a bipartisan replacement. That strategy worked for
President Obama when he allowed
the Bush tax cuts to expire at the
end of 2012 and then engaged in
bipartisan negotiations to rewrite
the tax code.
President Trump has now created another such opening for compromise by announcing he will end
ObamaCare’s cost-sharing payments
to insurers. Without a constant injection of additional money,
ObamaCare premiums will spiral
upward, and the number of Americans who benefit from the program
will continue to fall.
But the initial bipartisan bill, offered by Sens. Lamar Alexander
(R., Tenn.) and Patty Murray
(D., Wash.), is more of a capitulation than compromise. It resuscitates ObamaCare but hardly provides a fig leaf for Americans who
want their health-care freedom
back—the very people who elected
Republicans.
Any agreement to restore funding for cost-sharing payments
should be tied to provisions allowing families to opt out of ObamaCare and buy coverage that meets
their individual needs. The compromise should also grant insurers the
right to sell such plans independent
of ObamaCare’s rules and its rigged
risk pool.
A money-for-freedom compromise would at last provide an opportunity to debate health-care
freedom, something the public was
denied by the great ObamaCare lie.
If Democrats refuse to allow
ObamaCare’s losers to escape in return for funding for the program’s
beneficiaries, it will be Democrats
who let the program collapse.
Throughout the debate they will be
forced to argue against the very
health-care freedom they falsely
promised when they adopted
ObamaCare.
If Republicans seize this high
ground, they can quit fighting each
other and the Senate parliamentarian and instead engage the one issue Democrats have successfully
avoided for eight years: freedom.
When the freedom debate begins,
ObamaCare’s end will not be far
behind.
Mr. Gramm, a former chairman
of the Senate Banking Committee, is
a visiting scholar at the American
Enterprise Institute.
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American Express Chief to Leave
Credit-card market
has changed greatly
since he took over;
Squeri to be next CEO
BY ANNAMARIA ANDRIOTIS
Kenneth Chenault, the head
of American Express Co. and
one of the country’s most
prominent African-American
corporate leaders, will step
down as chairman and chief
executive Feb. 1, capping a 16year run at the iconic card
company as it grapples with a
new wave of competition.
The 66-year-old executive
will be succeeded as CEO by
Stephen Squeri, a three-decade
AmEx veteran who previously
ran its division in charge of
corporate cards. As vice chairman since 2015, Mr. Squeri, 58,
had spent more time meeting
with shareholders, leading
many to believe he was on the
shortlist to be the next chief
executive.
AmEx shares slipped 0.5% to
$91.60 in after-hours trading
despite the company reporting
stronger-than-expected earnings and revenue for the third
quarter and raising its profit
guidance for the year.
Mr. Chenault’s departure
comes after a tumultuous period in which he fought to revive AmEx’s fortunes following
the loss of a key partnership
with Costco Wholesale Corp.
and as the company’s pre-eminent product, the Platinum
card, came under attack from
J.P. Morgan Chase & Co.’s Sapphire Reserve card.
The Long Island, N.Y., native
had a stellar run for most of
his time atop the New Yorkbased company. But AmEx’s recent travails have cast a
shadow over his tenure—
something he fought to escape
before stepping aside.
Despite a booming creditcard market that recently surpassed $1 trillion in balances,
AmEx has ceded market share
and some shareholders have
questioned where long-term
growth will come from. Many
senior executives have left the
company, and Mr. Chenault
suffered a personal loss with
the unexpected death in 2015
of his would-be successor,
AmEx President Ed Gilligan.
The company’s main focus
in recent years has been ramp-
ing up lending to consumers
and small businesses while also
searching for new ways to appeal to millennials, many of
whom crave different kinds of
rewards and are more comfortable moving money with their
phones than a credit card.
Still, AmEx’s stock has rebounded of late as the company addressed some of shareholders’ biggest concerns. In
the past year, the shares have
rallied more than 50%, compared with a 28% rise in the
Dow Jones Industrial Average.
In recent months, shareholders
Please see AMEX page B2
Consumer-Goods Giant Tries New Formula
Reckitt is splitting into two divisions
amid a downturn. Protests broke
out last year in Seoul after a
disinfectant was tied to deaths.
EQT, the private-equity
group founded by Sweden’s
billionaire Wallenberg family,
has reached a deal to buy a
medical-device company from
the Pritzker Group for roughly
$250 million, said a person familiar with the matter.
The all-cash transaction is
for Clinical Innovations LLC,
of Salt Lake City, a manufacturer of suctions and other devices used during women’s labor and delivery of babies,
according to this person.
EQT announced the deal on
Wednesday.
The acquisition is the latest
medical-device deal by EQT,
which last year purchased
Lima, an Italian maker of
shoulder- and knee-replacement parts.
Clinical Innovations specializes in single-use, disposable
products used in hospitals
during the labor and delivery
of babies and in neonatal intensive-care units.
The company’s flagship
product is the suction device,
called the Kiwi Vacuum-As-
Share-price and index
performance, year to date
40%
Mastercard
Visa
American Express
S&P 500
30
20
10
0
J F M A M J
J A S O
Source: WSJ Market Data Group
THE WALL STREET JOURNAL.
BY ANNA WILDE MATHEWS
Reckitt Benckiser is pivoting to consumer health, a business that had slowed but not as dramatically as the broader consumer-goods sector.
Adjusted revenue growth of companies' consumer-health units
15 %
JOHNSON & JOHNSON
BAYER
RECKITT BENCKISER
GSK-NOVARTIS
PFIZER
10
5
0
–5
2015
Source: Credit Suisse
2016
2017
2015
2016
2017
2015
2016
2017
2015
2016
2017
Photo: Chung Sung-Jun/Getty Images
To arrest the decline, many
industry leaders are taking action.
Earlier this week, P&G narrowly won a proxy fight with
activist investor Nelson Peltz,
who has called on it to restructure to address these
headwinds. Nestlé SA recently
bowed to pressure from activist investor Dan Loeb and set a
formal profit-margin target.
Buyout Firm EQT Sets
Medical-Devices Deal
BY JONATHAN D. ROCKOFF
Charging
Anthem
To Launch
Pharmacy
Benefit
Manager
BY SAABIRA CHAUDHURI
LONDON—Reckitt Benckiser Group PLC is splitting its
business into two separate divisions, the latest move by a consumer-goods giant to address
an industrywide downturn.
Chief Executive Rakesh Kapoor will continue to preside
over the entire company, but
he will also run a new consumer-health division, which
will include brands like Durex
condoms and the recently acquired Mead Johnson babyfood division. After the restructuring, which will take
effect by Jan. 1, the unit will
make up about 60% of group
sales, which last year totaled
£9.89 billion ($13.04 billion).
A separate division—to be
run by one of Mr. Kapoor’s current deputies—will include
Reckitt’s home-and-hygiene
products, like Lysol, Finish
dishwasher tablets and Woolite.
The U.K.’s Reckitt and its rivals, including Procter & Gamble Co. and Unilever PLC, are
struggling with stalling sales
as consumer tastes in many
key markets change fast. Shoppers are gravitating toward
smaller, local products and
away from the megabrands
these companies have relied on
for sales growth for decades.
Sales growth at the world’s
packaged-foods
companies
slowed to 1.1% last year from
2.4% in 2013, according to
Morgan Stanley. Home-care
growth fell to 1.3% from 1.5%,
while beauty and personal care
dropped to 1.7% from 2.2%.
Until recently, benign inflation in many parts of the
world made it difficult to increase prices to make up for
lower volumes. Volatility in
emerging markets like India
and Brazil has further pressured sales.
“We have many more competitors to deal with now.
Channels have changed,” said
Mr. Kapoor in an interview.
“Therefore, this one-size-fits-all
does not work. We need to create more focus and expertise.”
See more at WSJMarkets.com
sisted Delivery System.
Use of such devices has
been rising in the U.S. and Europe amid an increase in highrisk births as more women
who are older and obese have
children, and sales have been
increasing in emerging markets such as China and India
as birth rates surge.
Brendan Scollans, an EQT
partner who is the investment
adviser for the EQT Mid Market U.S. fund, said in a statement that the group intends to
support Clinical Innovations
as it expands sales overseas,
“especially as it looks to bring
the strong product lineup to
China and other Asian markets.”
Clinical Innovations Chief
Executive Ken Reali said he
was “eager to partner with
EQT” and especially to work
together to expand the company’s sales internationally.
EQT is a world-wide investment firm with €37 billion
($44 billion) in capital invested across 24 funds.
The Pritzker Group, an investment firm, didn’t respond
to a request for comment.
The packaged-foods giant is
also selling its U.S. confectionery arm. Unilever split off its
spreads business into a separate unit, with its own management team, before earlier
this year saying it would consider selling the unit. That decision came after Unilever rejected a $143 billion bid by
Kraft Heinz Co., which triggered a number of moves by
INSIDE
PERSONAL TECHNOLOGY, B4
BIG BLUE PUTS
BIG BOARD
OVER 23000
WEDNESDAY’S MARKETS, B11
2016
2017
THE WALL STREET JOURNAL.
Unilever to appease investors.
Reckitt—one of the world’s
largest consumer-goods companies—spun off its pharmaceutical division in 2014. Earlier this year, it sold French’s
mustard and the rest of its
food unit to McCormick & Co.
Mr. Kapoor said Reckitt has
no plans to sell or spin off the
home-and-hygiene unit, or any
of its current businesses. He
said his primary aim is to focus management attention on
all the brands, to jump start
growth in both divisions.
Still, analysts saw the move
as a possible first step toward
more drastic measures.
“This new structure could
Please see SPLIT page B2
Heard on the Street: Move clears
way for bid on Pfizer unit..... B12
Rate-Rise Talk Stings Funds
BY LAURENCE FLETCHER
SOUNDING OUT
NEW SONOS
SPEAKER
2015
Anthem Inc. said it would
launch its own pharmacy-benefit manager, dealing a blow to
partner Express Scripts
Holding Co. and further reshuffling a sector under growing pressure to reduce costs
and bolster transparency.
The U.S.’s second-largest insurer said its pharmacy-benefit manager, to be called IngenioRx, will be serviced by CVS
Health Corp. when it launches
in 2020 after the conclusion of
its current contract with Express Scripts. Express Scripts
warned in April that Anthem,
its biggest customer, was unlikely to renew their pact once
it expires at the end of 2019.
Pharmacy-benefit managers—middlemen in health care
that help select which drugs
are covered for patients and
negotiate discounts with drugmakers—have drawn increasing scrutiny over whether and
how they wring savings from
the health-care system.
Anthem has sued Express
Scripts for allegedly overcharging on prescription drugs over
several years. Express has denied the allegations and made
its own counterclaims. The litigation has yet to come to trial.
In its lawsuit, Anthem alleged Express Scripts was getting an “obscene profit windfall” from overcharging the
insurer.
Express Scripts said in a
statement Wednesday that Anthem’s announcement was “disappointing” and “we know that
no other PBM will offer Anthem
the combination of savings,
member and client stability, and
Please see DRUGS page B2
The possibility of interestrate increases in the U.S. and
U.K. is playing havoc with the
trades of several large hedge
funds.
Computer-driven funds for
months have been trying to
profit from steady declines in
the dollar, British pound and
government-bond yields. But
many took a battering last
month when the Federal Reserve and Bank of England signaled future interest-rate
rises, sending those assets
into reverse.
While some funds clawed
back some ground early this
month, many are finding that
this September slump has
dented their 2017 performance.
The losses highlight how
many hedge funds and more
traditional investors have been
positioned for current benign
economic conditions to continue—conditions in which inflation and interest rates stay
low while bonds and stocks
edge higher.
Among funds losing money
is the $4.8 billion Bluetrend
fund, run by Brazilian finan-
Sticking with Quants
Quant hedge funds are underperforming human traders but
investors are still drawn to them.
Value of $1,000 invested
in each at year-end 2007
Cumulative net hedge-fund flows
since 2009
$1,500
$200 billion
Quant
Not quant
150
HFRI Fundamental Index
HFRI Quant Index
1,250
1,000
100
750
50
500
0
’08
’10
’12
’14
’16 ’17
Source: HFR
cier Leda Braga’s Systematica
Investments. It lost 4.7% last
month, according to numbers
sent to investors and reviewed
by The Wall Street Journal.
Despite a 1% gain in the first
week of October it is down 6%
for the year.
London-based Aspect Capital, which runs $6.6 billion in
assets, suffered a 4.4% loss in
its Diversified fund last month,
according to numbers sent to
investors. Despite a 2.6% gain
’10 ’11 ’12 ’13 ’14 ’15 ’16 ’17
THE WALL STREET JOURNAL.
in early October, it is down
2.1% this year, said a person
who had seen the numbers.
Man Group PLC, the
world’s biggest listed hedgefund firm, lost 5.7% in its $3.1
billion AHL Diversified fund in
September. It has clawed back
over half of that this month
and is up 2.1% this year, according to numbers from the
company.
September “proved to be a
Please see HEDGE page B2
B2 | Thursday, October 19, 2017
INDEX TO BUSINESSES
A
E
N
Abercrombie & Fitch...B3
Aberdeen Asset
Management.............B2
Abertis Infraestructuras
.....................................B3
Actividades de
Construccion y
Servicios ................... B3
Airbus .................... A2,B5
Alphabet......................B4
AlpInvest Partners...B10
Amazon.com........B4,B12
American Express . B1,B2
American International
Group.......................B10
Anthem .......... A4,B1,B12
Apple...........................B4
Ascent Resources.......B3
Aspect Capital ............ B1
Atlantia.......................B3
eHealth........................A4
Electronic Arts..........B12
EQT..............................B1
Express Scripts Holding
............................ B1, B12
Nordstrom.................B12
Northern Trust..........B11
Novartis.......................B3
F
P
C
Carlyle Group..............B3
Chesapeake Energy .... B3
Cigna ........................... A4
Citadel Securities.....B11
Clinical Innovations....B1
Credit Suisse.............B11
CVS Health..................B1
D
Deezer .........................B4
Delta Air Lines ........... B5
Oracle .......................... B4
Pfizer.........................B12
Procter & Gamble
............................. B1,B12
R
General Electric..........A1
GGV Capital.................B4
Gilead Sciences...........B3
Goldman Sachs Group
...................................B11
Grupo Villar Mir SAU.B3
H
HarbourVest Partners
...................................B10
Hearst..........................B3
Hochtief.......................B3
Reckitt Benckiser Group
............................. B1,B12
Rodale..........................B3
S
Société Générale.........B2
Sonos...........................B4
Spirit Airlines ............. B5
Spotify.........................B4
Supreme......................B3
Systematica
Investments..............B1
I
T
International Business
Machines.................B11
Target........................B12
TCI Fund Management
.....................................B3
TIAA-CREF .................. B2
Tidal.............................B4
Tortoise.....................B10
J
J.P. Morgan Chase....B11
L
Lovell Minnick Partners
...................................B10
M
Man Group .................. B1
Mariner Holdings......B10
Medica.........................A4
Merck...........................B2
Morgan Stanley........B11
U
Unilever.......................B1
United Continental
Holdings.............B5,B10
UnitedHealth Group..B12
U.S. Bancorp ............. B10
Y
Y Combinator..............B4
INDEX TO PEOPLE
A
G-H
Altman, Sam...............B4
Atkins, Paul .............. B11
Greenig, Doug.............B2
Hogan, Mark ............... B4
Hurd, Mark..................B4
B
Barlow, Russell...........B2
Belke, Bob.................B10
Birzer, Kevin..............B10
Braga, Leda.................B1
Buffett, Warren..........B2
C
Chenault, Kenneth I.
............................... B1,B2
D
de Boer, Harold...........B2
Deluard, Vincent.......B11
Detrick, Ryan ............ B11
Duperreault, Brian....B10
Peltz, Nelson.......B1,B12
Peretti, Jonah.............B4
Pomfret-Pudelsky,
Julian.......................B11
I
R
Immelt, Jeff................A1
Reali, Ken....................B1
Redfearn, Brett.........B11
Rutledge, Jeff...........B10
K
Kapoor, Rakesh....B1,B12
L
Lee, Jenny...................B4
Loeb, Dan....................B1
M
Maris, Bill....................B4
Metzman, David ....... B11
N
Northey, Bill..............B11
Continued from the prior page
say Mr. Chenault has appeared
more upbeat and confident in
his meetings with them.
In early June, the company
said it won the rights to become
the exclusive issuer of the Hilton Worldwide Holdings Inc.
credit cards starting in 2018,
beating out Citigroup Inc.
“We’re completing a twoyear turnaround ahead of plan
and getting ready to start a
new chapter,” Mr. Chenault
said on a conference call with
analysts Wednesday. He added
that the process of finding a
new CEO had been under way
for about five years and included candidates from inside
and outside the company. He
called Mr. Squeri “an excellent
strategist and a strong leader.”
One key constituent consulted by the company was
Warren Buffett, whose Berkshire Hathaway Inc. is the largest AmEx shareholder with a
17% stake. A shareholder in the
company for 53 years, Mr. Buffett said Wednesday that he had
spoken to both Mr. Chenault
and Mr. Squeri and in an interview added that the company
had “made a terrific choice.”
“We talked a lot about this
change over the last few
months, and I’m 100% on
board,” Mr. Buffett said.
In an interview, Mr. Squeri
said there would be some organizational changes at the
company in the next three
months as Mr. Chenault prepares to retire.
Kenneth Chenault’s retirement as chief executive at
American Express Co. will reduce the number of black CEOs
of Fortune 500 companies by a
quarter.
Mr. Chenault’s exit occurs as
many large companies are
showing greater concern for diversity. But even as top executives and boards devote more
time and resources to improv-
Kenneth Chenault to step down.
Few would argue that the
credit-card market has changed
dramatically since Mr. Chenault
took over in 2001. Two of the
most significant changes: increasing competition from
banks and more emphasis on
rewards for consumers.
Since the end of 2001, AmEx
shares have beaten the market,
rising 195%, compared with a
131% rise in the Dow and a 23%
ing ethnic and gender representation in their ranks, the number of black CEOs has
remained relatively stagnant.
The other black CEOs at
Fortune 500 businesses are
Roger W. Ferguson, Jr. at TIAA,
Kenneth C. Frazier of Merck &
Co. and J.C. Penney Co.’s Marvin
R. Ellison.
Mr. Chenault’s rise to the
top slot at AmEx in 2001 coincided with a relative surge in
the number of prominent black
CEOs. In 1999, Fannie Mae appointed Franklin Raines as its
CEO. That same year, Maytag
named Lloyd Ward chief executive.
Richard Zweigenhaft, a professor of psychology at Guilford
College in Greensboro, N.C., who
studies ethnicity and social mobility, says the period is an example of “one of the ironies of
diversity.”
“The corporate elite had
shown that it valued diversity.
Once barriers were broken, the
presence of some had decreased the pressure to increase the numbers [of toplevel black executives],” he said.
—John Simons
bump for the S&P 500 financial-stock index, according to
FactSet. In the last three years,
however, gains have been
tougher to come by, with AmEx
shares rallying only 12%, compared with a 41% rise in the
Dow and a 45% move in S&P
500 financial stocks.
AmEx has traditionally focused on cardholders who pay
their bills in full each month,
but that means the company
doesn’t typically generate the
interest revenue needed to offer as much in points and
other quantifiable rewards
that some big banks have been
doling out in recent years.
Some former executives
have said Mr. Chenault kept
the company on the sidelines
while rewards cards boomed,
focusing instead on projects
such as prepaid cards popular
with less affluent customers.
“We’ve been in this lending
business for a long time,” Mr.
Chenault said in an interview.
“We were able to come out of
crisis faster and stronger than
anyone else.”
Mr. Chenault in recent
months has been telling shareholders and analysts about
other cards that started out
hot and then fizzled out. In
fact, his view was vindicated
somewhat this year when J.P.
Morgan scaled back its Sapphire Reserve offering by lowering its initial sign-up bonus
amid concerns that the card’s
initial terms might not make
enough money for J.P. Morgan.
“Everybody doubted us and
we’re delivering,” said Mr.
Chenault at an investor meeting in July, according to a person who attended the meeting.
Mr. Buffett said the company
was right to part with Costco,
even though it was a shortterm hit to the company. “Every bank in the world would kill
for their credit experience,” he
said.
—Joann S. Lublin
contributed to this article.
S
W
Ward, Lloyd.................B2
Wayman, Troy.............B5
Wood, Andrew..........B12
F
P
Z
Pancari, John ............ B10
Zweigenhaft, Richard.B2
Continued from the prior page
clinical expertise that Express
Scripts represents.” Anthem’s
business had been worth
around $17.1 billion in annual
revenue to Express Scripts.
Anthem Chief Executive Joseph R. Swedish said the insurer wanted to increase savings and take more control
over pharmacy-benefit functions. “Drug costs, and the escalation of drug costs, is top of
mind for everyone in our industry,” as well as clients, he
said. Pharmacy “can be a key
ingredient to better managing
the total cost of care.” Anthem
said it decided that it would be
more efficient, and less expensive, to work with CVS instead
of attempting to build its own
PBM from scratch.
Anthem’s decision takes it
back toward a setup it had before its contract with Express
Scripts, which took over Anthem’s pharmacy services in
2009 when it bought Anthem’s
in-house PBM for about $4.68
billion.
The company said IngenioRx
would seek business from employers as well as insurers, particularly its fellow Blue Cross
Blue Shield companies.
Anthem said it expected the
new PBM to “achieve greater
than $4 billion in gross savings
annually,” starting in 2021
when the new setup is set to
be fully phased in. In a call
with analysts, the company
said the figure represents what
it projected to be reduced
pharmaceutical spending under its new contract with CVS.
Chenault Among
Few Black CEOs
Sasse, Ben..................A4
Scollans, Brendan.......B1
Sessions, Jeff.............A4
Squeri, Stephen..........B1
Flannery, John............A1
DRUGS
AMEX
Anthem said roughly 20% of
the savings would accrue to
the company, representing
pretax operating gain, while
the rest would be passed along
to clients.
This latest deal could prove
a harbinger, prompting other
big payers that now outsource
drug-benefit management to
take more control, said Pratap
Khedkar, managing principal
of ZS Associates, a health-care
consulting firm.
UnitedHealth Group Inc.,
the parent of the biggest U.S.
health insurer, UnitedHealthcare, also owns a large PBM,
OptumRx. Other insurers have
already been moving to exert A street cleaner in India with Reckitt’s Dettol disinfectant. Volatility in emerging markets has pressured sales at consumer-goods firms.
more influence over the pharstring of disappointing results. sions grow, even as they share health arm, a trend that would
macy benefit, even when they
Third-quarter comparable functions such as procurement have worsened with the acquiare using an outside company
sales fell 1% from a year ear- and financial services. He said sition of Mead Johnson.
to administer it.
lier, missing analysts’ fore- the home-and-hygiene brands
Anthem’s decision is a win
Acquiring Mead Johnson
for CVS, which said Anthem’s Continued from the prior page casts. Reckitt also reduced its have previously been ne- makes now “the perfect mofive-year contract includes ser- be the prelude to a split of the annual sales guidance for the glected, compared with the ment” to split out the operavices such as claims process- business or a sale” of the second time this year, saying higher-growth
consumer- tions, he said.
ing and prescription fulfill- home-and-hygiene businesses, it now forecasts flat sales,
ment.
Neither
company said Liberum analyst Robert compared with a previous esWaldschmidt.
timate of 2% growth.
disclosed details of the pact.
ADVERTISEMENT
Reckitt has a market capitalReckitt faces the same chalCVS Chief Executive Larry
Merlo said in a statement, “We ization of £49.5 billion. It is un- lenges as its rivals but has
look forward to working with clear what valuations the two also suffered company-specific
Anthem and IngenioRx to pro- divisions would command as setbacks. A Scholl-branded To advertise: 800-366-3975 or WSJ.com/classifieds
vide services to help ensure stand-alone companies, but both foot file, made for the shower,
flopped. A humidifier disinfeccoordinated, holistic care for would rank as sizable players.
BUSINESS OPPORTUNITIES
Amid the broader upheaval tant that Reckitt bought in
their PBM members.”
Size can be a huge benefit in the sector, Reckitt seemed South Korea has been blamed
in negotiating pricing with to be navigating the head- for dozens of deaths, trigger pharmaceutical companies. Ex- winds relatively well. Until ing a consumer backlash there.
press Scripts recently an- last year, it was a stock-mar- And it was hit harder than
nounced its own deal to buy ket darling that enjoyed most in a far-reaching cyberprivate medical-benefits man- strong growth and chunky attack, called Petya, this year.
The restructuring, anager eviCore healthcare for profit margins. Mr. Kapoor,
one of the best-paid CEOs nounced Wednesday, is geared
$3.6 billion.
! "###
—Jonathan D. Rockoff among London-listed blue toward addressing the slow $ %
& contributed to this article. chips, won a reputation for down. Mr. Kapoor said desig
' # '
keeping costs under control.
nated management teams
( )
Heard on the Street: Anthem
On Wednesday, though, would be able to better focus
Goes It Alone Over Prices B12 Reckitt reported the latest in a resources and help both divi-
SPLIT
The Mart
() *#++# ,-.&/(01
Continued from the prior page
challenging month” for quantitative funds that bet on market trends and other patterns,
said Russell Barlow, head of
hedge funds at Aberdeen Asset Management. He said
moves in short-term government bonds in the U.K., U.S.
and Europe drove returns.
Both the dollar and the 10year Treasury yield spiked after the election of President
Donald Trump last November.
But their slow and steady declines this year have provided
moneymaking opportunities
for these quant funds. These
funds often follow similar
trading strategies, trying to
latch onto market trends and
patterns. Some funds also
have profited from the decline
in the U.K. 10-year yield.
But an unexpectedly aggres-
PHOTO BANK/GETTY IMAGES
HEDGE
Leda Braga’s Bluetrend fund lost 4.7% last month.
sive tone from the Fed last
month, when officials signaled
they expect four rate increases
by the end of 2018, sent the
dollar and Treasury yields
sharply higher.
Across the Atlantic, sterling
and gilt yields jumped after
the Bank of England said mar-
kets may be underestimating
how soon interest rates may
rise.
Société Générale SA’s
Trend Indicator, a model portfolio that simulates the bets
these quant funds may place,
had been positioned for falling
10-year Treasury yields and a
falling dollar in September—
trades that would have delivered losses.
“The main drivers were a
sharp reversal in the dollar,
from a weakening trend to
dollar strength, and rising
global bond yields,” said Doug
Greenig, founder of Londonbased Florin Court Capital
Also losing money was
Netherlands-based Transtrend,
which runs $4.7 billion. It lost
6.4% last month in its Diversified Trend Program, according
to numbers sent to investors.
It is regained most of that this
month but is still down 3% for
the year, according to numbers
from the company.
The fund’s largest losses
came from “typical Brexit positions,” said Harold de Boer,
Transtrend’s head of research
and development, meaning
bets against the pound and on
rising U.K. bonds. The fund
also lost money in U.S. Treasurys and other bonds.
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Berkshire Hathaway...B2
Blue Cross Blue Shield
of Michigan .............. A4
Boeing..................B5,B11
Bombardier............A2,B5
BuzzFeed.....................B4
G
O
BUSINESS & FINANCE
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These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.
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* ***
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THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | B3
* * * *
BUSINESS NEWS
Gilead Sciences Inc.’s $11
billion bet on buying Kite
Pharma Inc. is poised to pay
off, with the approval Wednesday of Kite’s flagship cell-therapy treatment for adults with
advanced lymphoma.
The therapy, known as a
Car-T treatment, uses genetically engineered T-cells to attack the blood cancer. It is the
second such therapy to get a
regulatory green light, after
Novartis AG’s Car-T drug
Kymriah was approved in late
August for a form of leukemia
in children and young adults.
Like Novartis’s therapy,
which was priced at $475,000,
Gilead’s treatment commands
a
six-figure
list
price:
$373,000.
Gilead Chief Executive John
Milligan said in a statement
that the approval by the Food
and Drug Administration marks
“an important day for patients
with relapsed or refractory
large B-cell lymphoma who
have run out of options and
have been waiting for new
treatments that may help them
in their fight against cancer.”
The newly approved therapy, dubbed Yescarta, was the
crown jewel of Gilead’s recent
purchase of biotech Kite
Pharma. It has been among
the most highly anticipated
new drugs on Wall Street,
which estimates the therapy
will have $1.7 billion in worldwide sales in five years, according to EvaluatePharma, a
market-research firm.
Sales of Yescarta should
bolster Gilead’s efforts to diversify beyond its legacy drugs
for HIV/AIDS and hepatitis C
as their sales slow.
The company, which was
criticized by patients, doctors
and lawmakers for the high
list price of hepatitis C treatment Sovaldi, could face a new
round of scrutiny over Yescarta’s price tag. A Gilead
spokeswoman pointed to clinical-trial data showing the drug
worked in far more patients
than current standard-of-care
treatment.
“Taking into account these
important clinical data, we conducted extensive research with
commercial and government
payers, as well as targeted cancer centers, to set a price that
reflects the value represented
by this innovation, and that
supports accessibility of this
personalized therapy,” the
Gilead spokeswoman said.
—Thomas M. Burton
contributed to this article.
Hearst Plans
To Purchase
Publisher of
Men’s Health
BY JEFFREY A. TRACHTENBERG
Hearst agreed to purchase
Rodale Inc., the family-owned
publisher of magazines including
Women’s Health, Men’s Health
and Prevention, in a move that
will give it a major presence in
the health and wellness arena.
Terms of the deal weren’t
disclosed. A person familiar with
the matter said the price was
under $225 million. The deal is
expected to close in early 2018
after government approval.
Acquiring Rodale will allow
Hearst, owner of such titles as
Cosmopolitan, Town & Country
and Esquire, to diversify into
categories that have been relatively resilient in a tough publishing environment while creating opportunities to build
consumer businesses.
“There’s an advantage to
having publications that play to
the passions of their readers,”
said Steven Swartz, Hearst’s
chief executive, in an interview.
“We believe in magazines.
These brands will also do great
things on partner platforms like
Facebook, Google, Apple and
Snapchat.”
Rodale’s Men’s Health had a
total paid and verified circulation of 1.8 million copies for
the six-month period ended
June 30, according to the Alliance for Audited Media, while
Women’s Health had a total
paid and verified circulation of
1.5 million for the same period.
After string of gushers,
oil-and-gas driller looks
for a market valuation
of more than $3.5 billion
BY RYAN DEZEMBER
AND DANA MATTIOLI
Ascent Resources LLC, the
Appalachian oil-and-gas explorer founded by late oilman
Aubrey McClendon and two big
energy-investment firms, is
preparing for an initial public
offering or a sale, according to
people familiar with the matter.
The Oklahoma City company is interviewing bankers
to shepherd an offering and
aiming for a stock-market valuation of more than $3.5 billion, some of the people said.
An offering likely wouldn’t
take place until next year, and
there is no guarantee the company will go forward with an
IPO, they said.
Ascent will also likely shop
itself as a whole to competitors as it prepares for an IPO,
some of the people said.
A multibillion-dollar valuation would represent a sharp
turnaround from a year and a
half ago when the company
lost its famous founder in a fa-
tal traffic wreck, was mired in
debt, and suffering slumping
commodity prices.
Some debt issued by Ascent’s predecessor companies
spent stretches of 2016 trading
for pennies on the dollar, an
indication that investors believed a default was imminent.
Following Mr. McClendon’s
death, however, private-equity
firms Energy & Minerals Group
and First Reserve Corp. doubled down on their investments
in the company, infusing it with
roughly $1.5 billion that was
used to pay down its debt.
Meanwhile, the company
drilled one gusher after another on its 300,000 acres in
eastern Ohio and West Virginia. During the first half of
this year, for instance, Ascent
drilled 20 of the top 25 producing oil wells in Ohio, in addition to several of the largest
gas wells, according to state
data.
Ascent was one of several
energy companies Mr. McClendon launched with Houston’s
Energy & Minerals Group, or
EMG, after he was ousted over
corporate governance issues
from Chesapeake Energy
Corp., the oil-and-gas giant he
founded and turned into one
of the country’s largest shale
Ascending
Oil and natural-gas production has soared in Ohio as drillers, including
Ascent Resources, tap the prolific Utica Shale.
Ohio’s crude-oil production
Ohio’s natural-gas production
80,000 barrels a day
5 billion cubic feet a day
4
60,000
3
40,000
2
20,000
1
0
0
’12
’13
’14
’15
’16
’17
Note: Data are monthly.
Source: Energy Information Administration
drillers. Mr. McClendon’s final
years at Chesapeake were
marked by his enthusiasm for
and huge gamble on Ohio’s
Utica Shale. Under his direction, Chesapeake spent more
than $2 billion acquiring
rights to drill 1.3 million acres
in Ohio, or roughly 5% of the
state’s land area. He promised
state officials and investors
that the Utica would be the
“biggest thing to hit Ohio
since the plow.”
After he left Chesapeake in
2013, he went right back to
Ohio. Backed with cash from
’12
’13
’14
’15
’16
’17
THE WALL STREET JOURNAL.
EMG and First Reserve, Mr.
McClendon acquired swaths of
drilling land for the new business and hired several of his
former lieutenants at Chesapeake to run the company.
Ascent, formerly known as
American Energy Partners—
Utica LLC, got off to a fast
start. Within a year of its
founding, the company sold
convertible debt that valued
the business at $5 billion. But
its value quickly slipped away
as oil prices plummeted in late
2014 on a global supply glut,
and two historically warm
winters pressured natural-gas
prices.
Last year’s refinancing, in
which EMG, First Reserve and
some of their investors
pumped new cash into Ascent,
valued the business at about
$2.5 billion, some of the people familiar with the matter
said. The company has about
$1.6 billion of debt, down from
$2.7 billion at the end of 2015,
according to securities filings.
Meanwhile, the company’s
production in the first half of
this year was nearly double
that of the period in 2016. Average daily output from the
150-some wells Ascent operates
now exceeds the equivalent of
one billion cubic feet of gas,
some of the people said. That
ranks it as one of the country’s
largest gas producers.
Mr. McClendon’s minority
stake in the company was diluted by the refinancing maneuvers, but his estate still has
a financial interest in the company. So do some of his Wall
Street creditors, including
Goldman Sachs Group Inc. and
other banks to which he
pledged some of his future
profits in the business as collateral for a $465 million loan
he used to finance his postChesapeake comeback.
TAKASHI AOYAMA/GETTY IMAGES
BY JONATHAN D. ROCKOFF
Ascent Resources Plans IPO or Sale
An advertisement from streetwear brand Supreme in the Harajuku Shopping District in Tokyo. The New York company keeps its products in scarce supply to build buzz.
Streetwear Brand Leapfrogs Bigger Players
BY KHADEEJA SAFDAR
Supreme, an underground
streetwear brand with 11 stores
and a cult following, is now
worth more than teen retailer
Abercrombie & Fitch Co.,
which has about 900 stores
around the globe.
But a recent private-equity
investment raises the question
of whether a brand built by limiting distribution can generate
adequate growth without diminishing its appeal.
Founded in 1994, the seller of
skateboarding T-shirts, hats and
sweatshirts has tapped into the
zeitgeist of teens seeking hardto-get looks. Unlike traditional
retail chains, which aim to sell
as much as possible, the label
has relied on product scarcity
and word-of-mouth referrals to
generate hype around its name.
“If it was a factory pumping
out everything it could, no one
would want to wear it,” said
Zach Derubeis, a 19-year-old
student in Salem, N.H., who
buys and resells Supreme apparel.
The New York company, a
private entity that doesn’t report revenue, sold a roughly
50% stake to private-equity firm
Carlyle Group LP for about
$500 million, said a person familiar with the matter, valuing
it at nearly $1 billion.
By comparison, Abercrombie,
which has $3.3 billion in annual
revenue, has a market capitalization of $886 million. Carlyle
declined to comment. Supreme
and Abercrombie didn’t respond
to requests to comment.
The reversal comes as many
young people have turned away
from brands perceived as mainstream. Sales of Abercrombie
have slumped for four straight
years, and several of its rivals,
including Aéropostale Inc. and
American Apparel LLC, have
filed for chapter 11 bankruptcy
protection.
Supreme sells merchandise
from other apparel brands, but
the most coveted items are
those with the Supreme logo. A
limited number are released
throughout the year, and fans
frequently check blogs and
Facebook groups to learn about
the latest offering.
Online, the items sell out
promptly, appearing later on
eBay and other reselling plat-
forms at much higher prices.
“You have to be fast with your
fingers,” Mr. Derubeis said.
“The stuff is usually gone in
seconds.”
Then he is often faced with
the dilemma of whether to sell
an item or keep it. He said he
turned down a $350 offer for a
$54 T-shirt, but couldn’t resist a
$500 cash offer for a $150
hoodie.
Carlyle’s investment, previously reported by Women’s
Wear Daily, makes it unclear
whether Supreme can boost
sales without overexposing itself.
Brands built by “cultivating a
subculture” and relying on insider knowledge face a tipping
point, said Douglas Holt, president of Cultural Strategy Group,
a brand consultancy. “You can
only have so many people you
let in on the secret before all
the mystique melts away.”
Supreme’s popularity has
surged as ’90s streetwear styles
have made a comeback. It
ranked as the fourth-most-preferred website among upper-income male respondents, after
Amazon, Nike and eBay, based
on a recent Piper Jaffray survey
of 6,100 teens.
With so few locations, the
brand’s shop in New York City
has become a tourist attraction.
On a recent Sunday, families
with teens and 20-somethings
wrapped around three streets to
wait for a chance to enter the
store.
—Miriam Gottfried
contributed to this article.
Germany’s Hochtief
Offers to Buy Abertis
BY NATHAN ALLEN
Hochtief AG of Germany
made a €18.6 billion ($21.9 billion) offer to buy Abertis Infraestructuras SA, gate-crashing an effort by Italy's
Atlantia SpA to acquire the
Spanish toll-road operator.
Hochtief—a builder of infrastructure in the U.S. and Europe, which is controlled by
Spain’s Actividades de Construccion y Servicios SA—is
offering Abertis shareholders
€18.76 a share in cash, or
0.1281 of a Hochtief share, or a
mixture of both.
Barcelona-based Abertis,
which operates toll roads in
Europe and South America,
didn’t immediately comment
Wednesday on the bid. Abertis
is also yet to pass judgment
on a €16.50-a-share bid from
Italian highway operator Atlantia in May. Atlantia didn’t
immediately comment.
Abertis shares rose 7% in
European trading. Hochtief
ticked up 1%, while Atlantia
declined 1.2%.
A combination of Abertis
and Atlantia was approved by
the Spanish market regulator
and European competition authorities this month. It has
also been publicly backed by
two big Abertis shareholders:
British activist investor TCI
Fund Management and Spanish conglomerate Grupo Villar
Mir SAU.
However, reports in the
Spanish media have suggested
that the government is reluctant to let Abertis fall out of
Spanish control and favors a
PAU BARRENA/BLOOMBERG NEWS
Gilead’s
Cancer
Therapy
Approved
Workers control a highway tollbooth system in a facility in Spain operated by Abertis Infraestructuras.
domestic buyer.
Given Hochtief is more than
70%-owned by Spain’s Actividades de Construccion y Servicios, or ACS, its bid could be
favored.
ACS is one of Spain’s larg-
est construction companies,
with operations in more than
50 countries and revenue last
year of €31.98 billion.
Despite its heavyweight
backing, the deal would be a
big move for Hochtief, which
with a market capitalization of
€9.49 billion is considerably
smaller than Abertis, which
has a market value of €16.88
billion. It is also smaller than
Atlantia, which is valued at
€22.49 billion.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
B4 | Thursday, October 19, 2017
TECHNOLOGY
WSJ.com/Tech
PERSONAL TECHNOLOGY | By Wilson Rothman
New Sonos Speaker Is Good Home for Alexa
“Late Registration.” But
where the speakers are perfect for the former, they don’t
do a disservice to the latter.
R
WILSON ROTHMAN/THE WALL STREET JOURNAL
“Which
wireless
speaker
should I buy?”
Our typical
answer to
that question for years was
Sonos. There are speakers
that sound better—even
wireless ones—but there was
no easier way than the pioneering Wi-Fi sound system
to get your music right
where you wanted it.
Then Amazon introduced
the Echo speaker in 2014,
and Sonos became a harder
sell. It’s not that Amazon’s
talking tennis-ball cans
sound good; it’s just that 99
out of 100 times, convenience
beats quality. It doesn’t get
much more convenient than
barking orders at the Echo’s
ready-and-willing assistant,
Alexa. By no coincidence, Alphabet’s Google and Apple
both unveiled their own versions of the Echo—purporting better sound quality.
As its sales started to fall,
Sonos Inc. realized that beating ’em wasn’t an option.
“Joining ’em” meant building
a sound platform that retained its identity as a hardware maker while opening a
door for other companies’
software—i.e., voice assistants
like Alexa, Google Assistant
and possibly even Apple’s Siri.
The result is the $200 Sonos One speaker, available
Oct. 24. It looks and sounds
nearly identical to the Play:1
speaker from Sonos, but
there’s a microphone array
inside, and a little microphone icon up top.
Out of the gate, it comes
with Amazon’s Alexa built
in; Sonos says the Google
Assistant will also be available in 2018.
The $200 Sonos One has a compact shape with outsize audio performance. Amazon’s Alexa assistant is built into the speaker.
While there’s no plan for
Siri to live in the Sonos One,
the speaker (along with
other recent Sonos models)
is expected to be compatible
with Apple’s AirPlay 2 in the
first half of next year. This
would let you ask an iPhonebound Siri to send music to
the speaker.
E
ven at this early stage,
the Sonos One speaker
offers enough versatility and future-proofing to justify its price tag, especially if
you’re already an Amazon
Prime member. Buying two
for a stereo pair makes even
more sense.
While Sonos allows you to
control its speakers via an
Amazon Echo, the Sonos One’s
Alexa integration is deeper:
You can talk directly to it. In
fact, when I set up a pair,
both were listening. Only one
will answer, but I still muted
the mic on one to avoid getting random responses from
the left and right.
“Alexa, play Tom Petty.” If
you have Amazon Prime, you
will automatically access a
pretty big library of on-demand music, playlists and curated stations with the annual subscription. For many
particular albums—for instance, Tom Petty & the
Heartbreakers’ “Greatest
Hits”—Alexa will prompt you
to upgrade to an $8-a-month
(Prime members) or $10-amonth (non-Prime) Amazon
Music Unlimited plan. The
Sonos One also gives you Alexa voice control over
TuneIn, Pandora, SiriusXM
and iHeartRadio, which you
configure from the Alexa app.
Spotify is a special case:
While Amazon’s Echo speakers currently let you control
Spotify with your voice, Sonos says voice control of
Spotify will arrive this year.
The Sonos One otherwise
behaves just like any other Alexa-powered speaker. If you
enable skills in the Alexa app
(and carry out the appropriate setup), you can ask it to
turn down the lights and tell
you how to mix a Manhattan.
I did find that, when music is blaring, you sometimes
have to shout to get Alexa’s
attention.
Because this is a Sonos,
you can also stream music
from other services, such as
Apple Music, Deezer and
Tidal, as well as tracks
stored on mobile devices,
home computers and media
servers. You can’t ask Alexa
to pull up those tracks. Instead, you go into the Sonos
app, pick the service you
subscribe to and navigate the
menus to find your music.
U
nlike a Bluetooth
speaker, music
streamed from services will keep playing if you
wander in and out of the
house—or even if you leave
completely.
Once I set up the stereo
pair, designating an L and an
R in the Sonos app, I could
fill my living room with all
kinds of music, from classical
to jazz to rock to hip-hop. Sonos One has its limits, particularly on the low end—10,000
Maniacs’ “Unplugged” sounds
better than Kanye West’s
Shared Drone-Oversight Plan Takes Shape
As soon as the next few
days, the White House is expected to announce model
programs for easing the regulatory logjam on drones, industry officials said.
Devised by the Office of
Science and Technology Policy, these officials said, the
programs would test technical
advances and experiment with
oversight in limited airspace,
for the first time linking Federal Aviation Administration
rules with city, county or state
requirements. The aim would
be to expand uses for unmanned aircraft nationwide.
According to industry officials, the plan envisions continued FAA authority over
commercial drone operations
between 200 feet and 400 feet
in designated test areas, with
drones at lower altitudes primarily regulated by states,
counties or localities. The FAA
currently has full authority
over airspace at any altitude,
though debate over giving
more say to individuals and
communities is escalating in
Congress and in the industry.
Ultimately there could be 10
or more discrete model programs across the U.S., though
some industry officials expect
the White House to start with
fewer. Details including altitude distinctions also still
could change, they said.
A White House spokes-
JOHN LOCHER/ASSOCIATED PRESS
BY ANDY PASZTOR
The plan would link FAA drone regulations with city, county or state requirements for the first time.
woman declined to comment.
Earlier this month deputy
White House science adviser
Michael Kratsios signaled the
changes, telling a drone conference in San Jose, Calif., the
administration favors “more
engagement between industry
and state, local and tribal gov-
ernments.” He added, “We are
going to need local partnerships and community buy-in.”
After the speech, the drone
industry’s leading trade association asked President Donald
Trump for a pilot program “to
explore the best options for
states and municipalities to
address their needs” regarding
drone operations.
FAA chief Michael Huerta
told an earlier drone conference in Las Vegas that Washington needs “greater clarity
as to what state and local governments would like to see.”
The FAA last year adopted
final rules covering commercial operations of drones
weighing less than 55 pounds
and typically flying below 400
feet. Operators need special
approvals to fly at night, beyond the sight of groundbased operators and in proximity to U.S. airports.
White House officials previously discussed the issue with
drone proponents, suggesting
a potential presidential directive would reflect concerns
about rising foreign competition and the goal of promoting
domestic operations.
The drone-safety debate
has heated up as concerns
have risen about the risk of
collision between drones and
manned aircraft. Two weeks
ago, federal accident investigators opened a probe into a
Sept. 21 collision between a civilian drone and an Army
UH-60 helicopter east of
Staten Island, N.Y. Last weekend, Canada’s transport minister, Marc Garneau, announced
what experts have called the
first verified collision in North
America between a drone and
a commercial aircraft, a turboprop descending to land at
Quebec City’s international
airport. There weren’t any injuries in either incident.
The FAA’s top technical advisory organization separately
is developing standards for
drones, including larger versions with more sophisticated
avoidance technology.
HIGHLIGHTS FROM WSJ D. LIVE CONFERENCE
BuzzFeed CEO Prods
Facebook and Google
Tech giants Facebook Inc.
and Alphabet Inc.’s Google will
have to find better ways to
share revenue with media companies to support quality content, said BuzzFeed Chief Executive Jonah Peretti.
“The business model of news
is changing, and if Google and
Facebook take all the revenue
but don’t want to pay for the
fact checking, the reporting, the
more-intensive investigations,
who does that work?” Mr. Peretti said Wednesday at The Wall
Street Journal’s WSJ D.Live
technology conference in Laguna
beach, Calif. “I think Google and
Facebook are going to have to
fix that.”
News outlets increasingly
are pursuing subscription models and putting content behind
paywalls, which limits that
news to a smaller portion of
the population, Mr. Peretti said.
Meanwhile, Facebook’s news
feed, in particular, tends to support low-cost content, Mr. Peretti said. He said he thinks
Facebook is aware of this and
will work on creating more
ways for media companies to
earn revenue on its platform.
More digital ad spending
has been flowing to Facebook
and Google, which are expected
to eat about 63% of U.S. digital
ad dollars this year, according
to eMarketer. That means
there is less money to go
around for other publishers,
like BuzzFeed.
Still, Mr. Peretti said BuzzFeed is confident advertising is
still a good model. The company
has worked to diversify its revenue streams with other business
areas.
—Laura Stevens
Tech’s Power Likely
To Stir Backlash
Silicon Valley should brace for
more political backlash against
the tech sector as companies increasingly grow in size and
power, prominent startup investors said Wednesday.
“The system is not working
right,” said Sam Altman, president of the tech incubator Y
Combinator, at a panel at the
WSJ D.Live technology conference. “I don’t know if tech companies are going to get broken
up, but I do know the tech backlash is going to be strong.”
Driving these concerns are
job losses and economic inequality resulting from advances in
tech and artificial intelligence,
mixed with tech giants’ growing
influence in Americans’ lives and
politics, the panelists said.
“These companies are more
powerful than AT&T ever was,”
said Bill Maris, a venture capitalist who ran the venture-capital
arm of Google parent Alphabet
Inc. until earlier this year.
Beyond political concerns, the
investors—who also included
Jenny Lee, managing partner of
the Chinese venture-capital firm
GGV Capital—voiced concerns
about the health of many large
well-funded startups that are
valued at over $1 billion.
In the U.S., there are well
over 100 such companies, often
referred to as unicorns; many
raised money at high valuations
based on plans for growth that
haven’t materialized as hoped.
‘We’ll see more of the unicorns die” in the coming year,
Ms. Lee said.
Y Combinator’s Mr. Altman had
a more-measured view. He said
most unicorns are overvalued, but
that is normal in the startup world.
—Eliot Brown
Oracle Embraces
Shift to the Cloud
The software services industry is in the midst of generational
change, and Oracle Corp. has reacted by embracing the cloud.
The shift to selling webbased, on-demand computing
services has changed the way
Oracle is paid, Chief Executive
Mark Hurd said in an interview.
Mr. Hurd said shifting corporate
software systems to the cloud
provides more security for companies than they can provide by
managing systems themselves.
—Tripp Mickle
MORE ON MOBILE
WSJ
.COM
For a roundup of
the WSJ’s D.Live
technology
conference, visit
WSJ.com/Tech.
egardless, for its price,
the Sonos One sounds
far better than other
available Alexa-powered
speakers. It gains greater
sonic advantage when you
pair two for real stereo separation. (Why hello, Beatles’
“White Album”!)
It’s now hard to recommend a standard Echo
speaker to Alexa fans, even
though Amazon is releasing
a $100 updated version this
month. Picking Sonos or
Echo actually matters: You
can play the same music on
multiple Sonos speakers and
on multiple Echos, but you
can’t mix and match. I’d go
with Sonos wherever music
matters, adding Echo Dots
for voice control of the
larger, older speakers.
Apple and Google devotees
may want to wait until December to buy speakers. Apple’s $350 HomePod, announced in June, is set to ship
then, and it could potentially
sound very good. Google is
expected to ship a larger version of its Home speaker, the
$400 Home Max, then, too. At
those prices, however, they’ll
have to hold their own against
two Sonos Ones put together.
I found only one real downside to the Sonos One setup.
Now that Alexa is in charge of
bigger, better speakers, my
children aren’t stuck listening
to “Kidz Bop 35” through the
Echo in the kitchen. They can
ask Alexa to bring those saccharine, sanitized versions of
today’s top pop songs into my
grown-up living room, where
they do not belong.
Foxconn
Plant in
Wisconsin
Hits Bump
BY SHAYNDI RAICE
Wisconsin’s efforts to bring
a $10 billion Foxconn Technology Group plant to the state
have hit a snag, though supporters of the deal said they believe it will still come together.
The Wisconsin Economic Development Corp. delayed a vote
Tuesday to give final approval
to a contract that would provide the Taiwanese firm with $3
billion in economic incentives.
On Wednesday, a Democratic
state representative who opposed the deal told a local Wisconsin news organization that
the delay was over a “nuclear
bomb” in the contract that
wouldn’t sufficiently protect
taxpayers in the case that Foxconn didn’t fulfill its promises,
sparking concerns the deal
could be in trouble.
WEDC CEO Mark Hogan said
the delay was to ensure the deal
was done right.
“WEDC continues to do due
diligence on a complex deal,” Mr.
Hogan said. “We will take the
time necessary to ensure taxpayers are protected and Foxconn is
able to create tens of thousands
of family-supporting jobs in Wisconsin.”
Wisconsin Gov. Scott Walker
announced a tentative deal
with Foxconn in a White House
ceremony in July that was positioned as a victory in President
Donald Trump’s efforts to revive American manufacturing.
In September, the governor
signed legislation that approved giving the firm—formally known as Hon Hai Precision Industry Co.—the $3
billion incentive package.
Mr. Walker said in a statement he was “confident” the
state would reach an agreement with Foxconn.
After the legislation was approved, the economic development group was tasked with
negotiating the details of a contract with Foxconn. Its board
was supposed to approve the
contract Tuesday, but was told
the day before that negotiations were still ongoing. On
Wednesday, State Sen. Tim Carpenter described the holdup as
a “nuclear bomb” in an interview with the Wisconsin State
Journal. He didn’t respond to a
request for comment.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
Thursday, October 19, 2017 | B5
THE WALL STREET JOURNAL.
BUSINESS NEWS
This announcement is neither an offer to purchase nor a solicitation of an offer to sell Shares (as defined below), and the provisions herein are subject in their
entirety to the provisions of the Offer (as defined below). The Offer is made solely by the Offer to Purchase (as defined below), dated October 19, 2017, and the
related Letter of Transmittal (as defined below) and any amendments or supplements thereto, and is being made to all holders of Shares other than holders
of Shares in any jurisdiction in which the making of the Offer or the acceptance thereof would not be in compliance with the securities, blue sky or
other laws of such jurisdiction. In those jurisdictions where applicable laws or regulations require the Offer to be made by a licensed broker
or dealer, the Offer will be deemed to be made on behalf of Purchaser (as defined below) by one or more registered brokers or dealers
licensed under the laws of such jurisdiction to be designated by Purchaser, Parent (as defined below) or Deltek (as defined below).
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
Onvia, Inc.
LUKE SHARRETT/BLOOMBERG NEWS
at
$9.00 Net Per Share
by
Project Olympus Merger Sub, Inc.,
a wholly owned subsidiary of
A jet under assembly at the Airbus plant in Mobile, Ala., in July.
Delta Awaits
Bombardier Jets
Made in the U.S.
Delta Air Lines Inc. said
Wednesday that it intends to
take new Bombardier Inc. jetliners built at an Airbus SE faBy Susan Carey
in Atlanta and Doug
Cameron in Chicago
Bombardier and
Airbus plan to build
jets in Alabama to
avoid proposed tariffs.
probe by U.S. trade officials.
They have proposed tariffs
that would potentially quadruple the price of CSeries planes
for U.S. buyers after upholding
a complaint from Boeing Co.
that the Canadian aircraft
maker benefited from unfair
government subsidies.
A U.S. trade panel is due to
rule in February on whether
Boeing suffered any harm.
Boeing said that even
CSeries jets assembled in Mobile would be subject to tariffs
on imported parts.
Bombardier and Delta both
reject that argument.
“Boeing can make its own
decisions,” Mr. Bastian said.
But it is “hard to see how Boeing is harmed” when it doesn’t
have a plane in the 100- to
150-seat category.
LUCAS JACKSON/REUTERS
cility in Alabama, though it
didn’t provide a timeline for
the first delivery.
Bombardier and Airbus this
week announced a joint venture that would include building some CSeries jets at the
European company’s plant in
Mobile, Ala., in an effort to
avoid proposed tariffs levied
by U.S. trade officials on the
Canadian plane maker.
Delta was due to receive the
first of its 75 CSeries jets next
spring, and last week Chief Executive Ed Bastian said they
could be delayed because of
the spat between the U.S. and
Canada over Bombardier.
Mr. Bastian didn’t provide
further guidance on timing at
an event on Wednesday. Delta
is prepared to wait as long as
two years for the jets to ensure they are assembled in
Mobile and don’t attract tariffs, according to people involved in the negotiations.
Airbus builds four of its
A320 model jets a month at
the Mobile facility, which
opened in 2015.
Local officials said they
were unaware of the plan to
build Bombardier jets there
until just before this week’s
announcement.
Troy Wayman, vice president for economic development
at the Mobile Chamber of Commerce, said Airbus would likely
have to construct a new facility
to assemble the CSeries.
Mr. Wayman said officials
could likely agree on a pack-
age of incentives for Airbus in
less than six months.
Airbus and Bombardier
don’t expect to complete their
planned deal until the second
half of next year, and people
involved in the talks said it
could take more than a year to
construct facilities to assemble CSeries jets in Mobile.
Mr. Bastian said it isn’t
clear when the Airbus-Bombardier pact would secure regulatory approval or how long
it would take to establish a
new assembly line in Mobile.
A final decision on whether
to expand the Mobile plant
hinges on the outcome of a
Lie-back seats on United overseas flights. Earnings beat forecasts.
United Set to Boost
Capacity at Big Hubs
BY DOUG CAMERON
United Continental Holdings Inc. said Wednesday it
would continue to increase flying capacity to defend market
share at its big airport hubs as
the airline reported forecastbeating quarterly earnings.
Chicago-based United plans
to boost capacity by 3.5% in
the fourth quarter compared
with a year earlier. The
growth estimate would be at
the high end of its existing
guidance.
United, the third-largest
U.S. airline by traffic, has been
embroiled in fierce competition with low-cost carriers
such as Spirit Airlines Inc. at
big hubs like Chicago, which
depressed fares across the industry and led to a summer
selloff by investors that has
only reversed in recent weeks.
The parent of United Airlines forecast its closely
watched unit revenue would
fall by 1% to 3% in the fourth
quarter compared with a year
earlier, a sequential improvement. Delta Air Lines Inc. last
week opened the industry reporting season with betterthan-expected fourth-quarter
revenue guidance.
United reported profit fell
to $669 million from $965 million for the September quarter, typically the strongest for
U.S. airlines but one disrupted
this year by severe weather.
Earnings per share slipped to
$2.22 from $3.01 a year earlier, 2 cents above analysts’
consensus.
The hurricanes and storms
that affected United’s hubs, especially in Houston, reduced
pretax profit by $185 million
in the quarter.
Project Diamond Intermediate Holdings Corporation
the parent company of
Deltek, Inc.
Project Olympus Merger Sub, Inc., a Delaware corporation (“Purchaser”) and a wholly owned subsidiary of Project Diamond Intermediate
Holdings Corporation, a Delaware corporation (“Parent”) and the parent company of Deltek, Inc., a Delaware corporation (“Deltek”), is
offering to purchase any and all issued and outstanding shares of common stock, $0.0001 par value per share (the “Shares”), of Onvia, Inc.,
a Delaware corporation (“Onvia”), at a price of $9.00 per Share (the “Offer Price”), net to the seller in cash, without interest thereon and
subject to any applicable withholding taxes, upon the terms and subject to the conditions set forth in the offer to purchase, dated October 19,
2017 (as it may be amended or supplemented from time to time, the “Offer to Purchase”), and the related letter of transmittal (as it may be
amended or supplemented from time to time, the “Letter of Transmittal,” and together with the Offer to Purchase, the “Offer”).
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, AT THE END OF THE DAY ON NOVEMBER 16, 2017, UNLESS THE OFFER IS
EXTENDED (SUCH DATE AND TIME, AS IT MAY BE EXTENDED, THE “EXPIRATION DATE”).
The purpose of the Offer is for Parent, indirectly through Purchaser, to acquire control of, and the entire equity interest in, Onvia.
Following the consummation of the Offer, Purchaser intends to effect the Merger (as defined below).
The Offer is being made in accordance with the terms of the Agreement and Plan of Merger, dated as of October 4, 2017 (as it may be
amended or supplemented from time to time, the “Merger Agreement”), by and among Onvia, Parent and Purchaser. Parent is the sole
stockholder of Deltek, which has guaranteed all of Parent’s and Purchaser’s obligations under the Merger Agreement. Under the Merger
Agreement, after the consummation of the Offer and the satisfaction or waiver of certain conditions, Purchaser will be merged with and into
Onvia (the “Merger”), with Onvia continuing as the surviving corporation and a wholly owned subsidiary of Parent. At the effective time
of the Merger (the “Effective Time”), each issued and outstanding Share (other than any Shares owned by Onvia or by Parent, Purchaser,
Deltek or any other wholly owned subsidiary of Parent, those Shares irrevocably accepted for purchase pursuant to the Offer and Shares
held by stockholders who have properly and validly perfected appraisal rights in compliance in all respects with Section 262 of the General
Corporation Law of the State of Delaware (the “DGCL”)) immediately prior to the Effective Time will as a result of the Merger, be converted
automatically into the right to receive from Purchaser an amount in cash, without interest and subject to any applicable withholding taxes,
equal to the Offer Price, payable to the holder thereof upon surrender of the certificate formerly representing, or book-entry transfer of, such
Share. As a result of the Merger, Onvia will cease to be a publicly traded company and will become wholly owned by Parent. The
Merger Agreement is more fully described in the Offer to Purchase.
The Offer is conditioned upon (i) the Merger Agreement not having been validly terminated in accordance with its terms, (ii) the satisfaction
of the Minimum Condition (as described below), (iii) the absence of any law or order currently in effect that is deemed applicable to the Offer or
the Merger which directly or indirectly prohibits, or makes illegal, the acceptance for payment of or payment for Shares or the consummation
of the Offer or the Merger, (iv) the absence of any pending legal proceeding by a governmental body having authority over Parent, Purchaser
or Onvia challenging or seeking to restrain or prohibit the consummation of the Offer or the Merger and (v) other customary conditions as
described in Section 13—“Conditions of the Offer” of the Offer to Purchase. There is no financing condition to the Offer.
The Minimum Condition requires that, immediately prior to the Expiration Date, there shall have been validly tendered (and not otherwise
properly withdrawn) that number of Shares which, when added to the Shares owned by Parent and its subsidiaries (if any), would represent at
least one Share more than half of all of the Shares then outstanding (assuming conversion or exercise of all derivative securities convertible
or exercisable immediately prior to the Expiration Date, regardless of the conversion or exercise price).
The Onvia board of directors, at a meeting duly called and held, unanimously (i) determined that the Merger Agreement and the
transactions contemplated by the Merger Agreement are fair to and in the best interests of Onvia’s stockholders, (ii) approved and
declared advisable the Merger Agreement and the transactions contemplated by the Merger Agreement in accordance with the DGCL,
and (iii) resolved to recommend that the holders of Shares accept the Offer and tender their Shares to Purchaser pursuant to the Offer.
Subject to the provisions of the Merger Agreement, Purchaser expressly reserves the right (but is not obligated), at any time or from time to
time, to waive or otherwise modify or amend the terms and conditions of the Offer in any respect. Purchaser has agreed in the Merger Agreement
that it will not, without the prior written consent of Onvia, waive or modify certain conditions as described in Section 1—“Terms of the Offer”
of the Offer to Purchase. Purchaser may be required to extend the Offer (i) for the minimum period required by any applicable law, regulation,
interpretation or position of the Securities and Exchange Commission (the “SEC”), the NASDAQ Capital Market or their respective staff, or
(ii) for one or more successive periods of up to ten business days per extension (or such longer period as Purchaser and Onvia may mutually agree),
if, at the time the Offer is scheduled to expire, any of the conditions of the Offer have not been satisfied or waived, until such time as all conditions
of the Offer are satisfied or waived, except that without Onvia’s written consent, Purchaser may not extend the Offer beyond April 2, 2018.
Any extension or amendment of the Offer, waiver of a condition of the Offer, delay in acceptance for payment or payment, or termination
of the Offer will be followed as promptly as practicable by public announcement thereof, such announcement in the case of an extension of
the Offer to be issued not later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration of the
Offer in accordance with the public announcement requirements of Rules 14d-4(d), 14d-6(c) and l4e-1(d) under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”).
The Merger Agreement does not provide for, and it is not expected that there will be, a “subsequent offering period” (within the meaning
of Rule 14d-11 under the Exchange Act). A “subsequent offering period” is different from an extension of the Offer.
In accordance with the Merger Agreement, if Purchaser accepts for payment and pays for a majority of the issued and outstanding Shares
in the Offer, Purchaser will complete the Merger without a vote of the stockholders of Onvia in accordance with Section 251(h) of the DGCL.
In all cases, payment for any Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt
by Broadridge Corporate Issuer Solutions, Inc. (the “Depositary”) of (i) certificates representing such Shares, an indication in the Letter
of Transmittal of the tender of Direct Registration Book-Entry Shares (as defined in Section 3—“Procedures for Tendering Shares” of the
Offer to Purchase) or confirmation of the book-entry transfer of such Shares into the Depositary’s account at The Depository Trust Company
pursuant to the procedures set forth in Section 3—“Procedures for Tendering Shares” of the Offer to Purchase, (ii) the Letter of Transmittal,
properly completed and duly executed in accordance with the instructions of the Letter of Transmittal, with any required signature guarantees
(or, in the case of a book-entry transfer, an Agent’s Message (as defined in Section 3—“Procedures for Tendering Shares” of the Offer to
Purchase) in lieu of the Letter of Transmittal), and (iii) any other documents required by the Letter of Transmittal.
For purposes of the Offer, Purchaser will be deemed to have accepted for payment and thereby purchased Shares validly tendered and
not properly withdrawn on or prior to the Expiration Date as, if and when Purchaser gives oral or written notice to the Depositary of its
acceptance for payment of such Shares pursuant to the Offer. Upon the terms and subject to the conditions of the Offer, payment for Shares
accepted for payment pursuant to the Offer will be made by deposit of the Offer Price for such Shares with the Depositary, which will act
as paying agent for the tendering stockholders for purposes of receiving payments from Purchaser and transmitting such payments to the
tendering stockholders. Under no circumstances will interest be paid on the Offer Price for Shares, regardless of any extension of the
Offer or any delay in payment for Shares.
Shares validly tendered pursuant to the Offer may be properly withdrawn at any time on or prior to the Expiration Date, and, unless
theretofore accepted for payment by Purchaser pursuant to the Offer, may also be properly withdrawn at any time after December 17, 2017,
which is the 60th day after the date of the commencement of the Offer.
For a withdrawal of Shares to be effective, a written notice of withdrawal must be received by the Depositary at one of its addresses set
forth on the back cover of the Offer to Purchase on or prior to the Expiration Date. Any notice of withdrawal must specify the name of the
person having tendered the Shares to be withdrawn, the number of Shares to be withdrawn and the name of the record holder of the Shares to
be withdrawn, if different from that of the person who tendered such Shares. The signature(s) on the notice of withdrawal must be guaranteed
by an Eligible Institution (as defined in Section 3—“Procedures for Tendering Shares” of the Offer to Purchase), unless such Shares have
been tendered for the account of any Eligible Institution. If Shares have been tendered pursuant to the procedures for book-entry transfer
as set forth in Section 3—“Procedures for Tendering Shares” of the Offer to Purchase, any notice of withdrawal must specify the name and
number of the account to be credited with the withdrawn Shares. If certificates representing the Shares have been delivered or otherwise
identified to the Depositary, the name of the registered owner and the serial numbers shown on such certificates must also be furnished to the
Depositary prior to the physical release of such certificates.
The information required to be disclosed by Rule 14d-6(d)(1) under the Exchange Act is contained in the Offer to Purchase and is
incorporated herein by reference.
Onvia has provided Purchaser with Onvia’s list of stockholders and security position listings for the purpose of disseminating the Offer to
Purchase, the related Letter of Transmittal and other related materials to holders of Shares. The Offer to Purchase, related Letter of Transmittal
and other related materials will be mailed to record holders of Shares whose names appear on the list of stockholders of Onvia and will be
furnished to brokers, dealers, commercial banks, trust companies and other nominees whose names appear on a list of stockholders or, if
applicable, who are listed as participants in a clearing agency’s security position listing, for subsequent transmittal to beneficial owners of Shares.
The receipt of cash for Shares pursuant to the Offer or the Merger will be a taxable transaction for U.S. federal income tax purposes and
may also be a taxable transaction under applicable state, local, foreign or other laws. Holders of Shares are urged to consult with their own
tax advisors as to the particular tax consequences of the Offer and the Merger to them.
The Offer to Purchase and the related Letter of Transmittal and Onvia’s Solicitation/Recommendation Statement on
Schedule 14D‑9 with respect to the Offer filed with the SEC in connection with the Offer contain important information and each
such document should be read carefully and in its entirety before any decision is made with respect to the Offer.
Questions and requests for assistance may be directed to MacKenzie Partners, Inc. (the “Information Agent”) at the address and telephone
numbers set forth below. Requests for copies of the Offer to Purchase and the related Letter of Transmittal may be directed to the Information
Agent or to brokers, dealers, commercial banks, trust companies or other nominees. Such copies will be furnished promptly at Purchaser’s
expense. Purchaser will not pay any fees or commissions to any broker or dealer or any other person (other than the Information Agent or
as otherwise described in Section 17—“Fees and Expenses” of the Offer to Purchase) for soliciting tenders of Shares pursuant to the Offer.
The Information Agent for the Offer is:
105 Madison Avenue
New York, New York 10016
(212) 929-5500 (call collect)
or
Call Toll Free (800) 322-2885
Email: tenderoffer@mackenziepartners.com
October 19, 2017
THE WALL STREET JOURNAL.
B6 | Thursday, October 19, 2017
ADVERTISEMENT
Focus on Franchising
To advertise: 800-366-3975 or WSJ.com/classifieds
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© 2017 Dow Jones & Company, Inc.
All Rights Reserved.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | B7
MARKETS DIGEST
EQUITIES
Dow Jones Industrial Average
S&P 500 Index
Last Year ago
23157.60 s 160.16, or 0.70%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio 21.13 19.79
P/E estimate *
19.39 17.46
Dividend yield
2.22
2.58
All-time high 23157.60, 10/18/17
Nasdaq Composite Index
Last
2561.26 s 1.90, or 0.07%
High, low, open and close for each
trading day of the past three months.
Year ago
Trailing P/E ratio 24.55 24.33
P/E estimate *
19.39 18.12
Dividend yield
1.95
2.15
All-time high: 2561.26, 10/18/17
Last Year ago
6624.22 s 0.56, or 0.01%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio * 26.19
24.15
P/E estimate *
21.15
19.55
Dividend yield
1.10
1.22
All-time high: 6624.22, 10/18/17
Current divisor 0.14523396877348
23500
2560
6600
23000
2530
6500
22500
2500
6400
22000
2470
6300
21500
2440
Session high
UP
Close
t
DOWN
Session open
Open
t
Close
Session low
65-day moving average
6200
65-day moving average
65-day moving average
21000
6100
2410
Bars measure the point change from session's open
20500
July
Aug.
Sept.
6000
2380
Oct.
July
Aug.
Sept.
July
Oct.
Aug.
Sept.
Oct.
Weekly P/E data based on as-reported earnings from Birinyi Associates Inc.
Major U.S. Stock-Market Indexes
High
Latest
Close
Low
Net chg
% chg
52-Week
Low
High
% chg
YTD
% chg
3-yr. ann.
Dow Jones
Industrial Average
Transportation Avg
Utility Average
Total Stock Market
Barron's 400
23172.93 23086.75 23157.60 160.16
9936.91
9837.23
9899.67
75.53
740.97
736.46
739.62
-0.95
26590.52 26537.89 26557.95
687.48
684.79
686.61
27.60
2.53
Nasdaq Stock Market
Nasdaq Composite
6635.52
Nasdaq 100
6129.49
Standard & Poor's
500 Index
6613.55
6106.85
2564.11
6624.22
6114.35
2559.67
1.90
27.2
17.2
12.2
0.77 10038.13
7967.02
22.8
9.5
6.7
754.80
625.44
12.2
12.1
9.6
26557.95 21514.15
687.05
521.59
19.7
26.2
14.1
14.1
10.6
11.4
-0.13
0.10
0.37
0.56
-8.26
2561.26
0.70 23157.60 17888.28
0.01
-0.13
0.07
MidCap 400
SmallCap 600
1825.54
913.12
1817.96
908.03
1821.89
911.58
5.55
6.38
Other Indexes
Russell 2000
1507.84
1497.98
1505.14
7.65
12382.59 12358.10 12371.02
21.05
0.17
1.32
0.24
NYSE Composite
544.06
541.93
NYSE Arca Biotech
4329.04
4269.40
NYSE Arca Pharma
Value Line
543.25
558.95
555.23
556.37
-0.28
99.76
98.87
0.64
PHLX§ Gold/Silver
99.43
85.72
84.76
85.06
PHLX§ Semiconductor
CBOE Volatility
0.70
0.51
4273.28 -25.26
KBW Bank
PHLX§ Oil Service
0.31
137.60
134.39
134.49
1230.07
10.41
1212.17
9.87
1228.16
10.07
-0.59
-0.05
0.65
-0.70 -0.82
-2.83
0.33
5046.37
4660.46
26.3
26.4
2085.18
23.1
25.7
19.4
14.4
15.9
17.0
10.7
1821.89
918.72
1476.68
703.64
18.8
23.1
9.7
8.8
11.3
13.4
1512.09
1156.89
23.1
10.9
11.6
12371.02 10289.35
Trading Diary
Most-active and biggest movers among NYSE, NYSE Arca, NYSE Amer.
and Nasdaq issues from 4 p.m. to 6:30 p.m. ET as reported by electronic
trading services, securities dealers and regional exchanges. Minimum
share price of $2 and minimum after-hours volume of 5,000 shares.
Volume, Advancers, Decliners
Most-active issues in late trading
Company
Symbol
Volume
(000)
Region/Country Index
Close
Net chg
After Hours
% chg
High
0.03
DJ Americas
617.81
Sao Paulo Bovespa 76591.09
S&P/TSX Comp
15782.16
S&P/BMV IPC
49938.98
Santiago IPSA
4188.57
Latest
% chg
7.09
0.53
0.50
0.80
389.84
–34.74 –0.22
–201.54 –0.40
26.32
EMEA
Eurozone
Belgium
France
Germany
Israel
Italy
Netherlands
Russia
Spain
Sweden
Switzerland
U.K.
Stoxx Europe 600
Euro Stoxx
Bel-20
CAC 40
DAX
Tel Aviv
FTSE MIB
AEX
RTS Index
IBEX 35
SX All Share
Swiss Market
FTSE 100
391.56
392.32
4075.25
5383.81
13043.03
1447.39
22354.69
547.68
1147.79
10273.40
587.86
9309.61
7542.87
1.12
1.38
6.48
22.44
47.97
3.71
16.91
1.06
1.17
56.60
2.78
39.75
26.70
Asia-Pacific
Australia
China
Hong Kong
India
Japan
Singapore
South Korea
Taiwan
S&P/ASX 200
5890.50
Shanghai Composite 3381.79
Hang Seng
28711.76
S&P BSE Sensex
32584.35
Nikkei Stock Avg
21363.05
Straits Times
3329.03
Kospi
2482.91
Weighted
10720.28
0.90
9.75
14.27
–24.81
26.93
…
–1.46
–2.87
7,301.3 255.75
Resource Capital
RSO
3,989.4
10.44
…
unch.
10.46
10.44
eBay
EBAY
3,527.5
35.60
-2.37
-6.24
39.30
34.97
0.01 255.84 255.65
Ford Motor
F
3,357.9
unch.
12.22
12.18
12.19
…
Alibaba Group Holding ADR BABA
3,073.8 179.50
-0.11
-0.06 179.73 177.12
KEY
KeyCorp
VanEck Vectors Gold Miner GDX
2,866.5
18.47
-0.11
-0.59
18.67
18.46
2,003.5
23.35
0.02
0.09
23.37
23.29
General Electric
1,854.4
23.12
…
unch.
23.15
23.04
89.4
5.00
0.52
11.61
5.15
4.48
706.3 166.07
13.07
GE
Percentage gainers…
Limelight Networks
LLNW
Adobe Systems
ADBE
8.54 167.45 152.06
206.9
5.55
0.40
7.77
5.70
5.08
Viking Therapeutics
VKTX
68.7
2.76
0.16
6.15
2.80
2.53
Verastem
VSTM
139.7
4.12
0.22
5.64
4.12
3.98
5.3
9.85
-0.69
-6.55
10.54
9.75
3,527.5
35.60
-2.37
-6.24
39.30
34.97
34.1
12.50
-0.74
-5.59
13.29
12.50
5.0
4.60
-0.20
-4.17
4.60
4.60
9.2
14.30
-0.60
-4.03
14.90
14.30
Conatus Pharmaceuticals CNAT
16.7
11.9
6.5
455.65
14.2
7.3
5.6
4304.77
2834.14
41.1
39.0
12.3
556.65
463.78
12.6
15.5
3.9
...And losers
100.76
73.03
36.2
8.3
14.2
Earthstone Energy
ESTE
96.72
73.03
-2.9
7.9
3.3
eBay
EBAY
117.79
-20.3
-26.8 -17.6
Rowan Cos
RDC
802.88 51.5
9.19 -30.1
35.5 28.8
-28.3 -22.9
Kamada Ltd.
KMDA
Ship Fin Intl
SFL
YTD
% chg
0.24
0.14
0.19
16.9
17.6
21.1
0.13
0.51
14.3
27.2
3.2
9.4
30.0
0.63
0.29
0.35
0.16
0.42
0.37
0.26
0.08
0.19
0.10
0.55
0.48
0.43
0.36
8.3
12.0
13.0
10.7
13.6
–1.6
16.2
13.4
–0.4
9.9
10.0
13.3
5.6
0.02
0.29
0.05
4.0
9.0
30.5
22.4
11.8
15.6
22.5
15.9
–0.08
0.13
Closed
–0.06
–0.03
Company
Symbol
Spectrum Pharmaceuticals
China Internet Nationwide
Veritone
Viking Therapeutics
CGG ADR
SPPI
Qudian ADR
Spring Bk Pharmaceuticals
Cree
Krystal Biotech
TSR
QD
Hebron Technology
Ignyta
Endocyte
Nortech Systems
Rimini Street
HEBT
CIFS
VERI
VKTX
CGG
SBPH
CREE
KRYS
TSRI
RXDX
ECYT
NSYS
RMNI
High
52-Week
Low
% chg
19.67
28.90
37.65
2.60
5.57
5.21
6.44
8.13
0.53
1.07
36.03
28.67
27.54
25.60
23.78
21.95 3.21
30.00 10.81
74.92 7.76
2.88 0.88
29.70 3.26
398.0
...
...
126.1
-80.8
29.18
17.76
34.16
11.19
5.45
5.18
2.65
4.82
1.48
0.65
21.58
17.54
16.43
15.24
13.54
...
...
17.76 6.31
35.46 20.50
11.98 9.42
11.10 3.80
...
64.4
52.4
...
-2.7
3.48
16.25
4.91
4.20
9.47
0.41
1.90
0.56
0.47
0.97
13.36
13.24
12.87
12.47
11.35
7.02
18.30
6.55
4.60
10.40
...
196.5
70.5
11.6
-3.6
2.50
4.15
1.17
3.13
8.30
Most Active Stocks
Company
Symbol
Bank of America
Finl Select Sector SPDR
TransEnterix
Micron Technology
Ocean Power Techs
BAC
Advanced Micro Devices
AT&T
iShares MSCI Emg Markets
Encana
SPDR S&P 500
AMD
XLF
TRXC
MU
OPTT
EEM
ECA
SPY
Selected rates
A consumer rate against its
benchmark over the past year
Five-year ARM, Rate
4.00%
(ARM)
3.00
2.00
t
1.00
0.00
N D J FMAM J J A S O
2016 2017
Your Equity Services
Sammamish, WA
2.88%
425-392-2295
Oritani Bank
Twp of Washington, NJ
3.00%
888-674-8264
RTN Federal Credit Union
3.00%
Waltham, MA
781-736-9900
Wednesday
1
3 6
month(s)
One year ago
1 2 3 5 710
years
maturity
Federal-funds rate target
1.00-1.25 1.00-1.25
Prime rate*
4.25
4.25
Libor, 3-month
1.36
1.36
Money market, annual yield
0.32
0.32
Five-year CD, annual yield
1.46
1.46
30-year mortgage, fixed†
3.92
3.89
15-year mortgage, fixed†
3.19
3.19
Jumbo mortgages, $424,100-plus† 4.40
4.42
Five-year adj mortgage (ARM)† 3.53
3.53
New-car loan, 48-month
3.06
3.06
HELOC, $30,000
5.23
5.21
3-yr chg
52-Week Range (%)
Low 0 2 4 6 8 High (pct pts)
0.25 l
l
3.50
0.88 l
0.26 l
1.19 l
l
3.54
l
2.81
l
4.23
l
3.13
l
2.85
l
4.57
1.25
4.25
1.36
0.36
1.47
4.33
3.50
4.88
4.03
3.36
5.30
1.00
1.00
1.13
-0.10
-0.05
-0.12
0.03
-0.07
-0.11
-0.16
0.78
14.07 -0.64
35.71 -1.44
46.50 0.24
11.79 3.24
255.72 0.10
15.65
6.22
43.03 35.10
46.82 33.94
13.85
8.01
255.95 208.38
10%
0
–5
0.75
–10
0.00
–15
30
Bankrate.com rates based on survey of over 4,800 online banks. *Base rate posted by 70% of the nation's largest
banks.† Excludes closing costs.
Sources: SIX Financial Information; WSJ Market Data Group; Bankrate.com
WSJ Dollar index
s
Euro
s Yen
12.25
3.75
18.31
6.96
8.30
4.72
0.74
3.96
0.67
2.00
31.5
15.8
...
76.1
-47.4
17.09
11.67
5.10
16.32
3.89
-2.29
-1.52
-0.60
-1.91
-0.44
-11.82
-11.52
-10.53
-10.48
-10.16
36.68 17.08
49.94 8.71
8.75 1.70
38.86 2.20
7.85 1.37
-46.7
-68.9
47.8
184.3
-30.8
MNKD
CLDC
Country/currency
SNCR
VHC
HMNY
IZEA
Ranked by change from 65-day average*
KAAC
IDLB
BXC
SMLF
SPPI
RXDX
RDCM
IMDZ
Volume % chg from Latest Session
(000) 65-day avg Close % chg
4,231
875
402
636
161
13357
3077
2910
2049
1881
21,501
19,606
11,858
500
2,193
1620
1403
1307
1147
1051
US$vs,
YTDchg
Wed
in US$ per US$ (%)
Americas
Argentina peso
.0577 17.3375
Brazil real
.3153 3.1711
Canada dollar
.8021 1.2468
Chile peso
.001599 625.20
Colombia peso
.0003421 2923.33
Ecuador US dollar
1
1
Mexico peso
.0530 18.8587
Peru new sol
.3090 3.237
Uruguay peso
.03392 29.4800
Venezuela b. fuerte .100100 9.9901
Yield (%)
Last Week ago
52-Week
High
Low
Total Return (%)
52-wk
3-yr
2.105
2.090
2.237
1.467 –1.651 1.717
2.339
3.028
2.580
5.124
2.800
1.881
2.346
3.004
2.570
5.173
2.830
1.920
2.609
3.390
2.790
6.448
3.120
2.516
1.740
2.648
2.050
4.948
2.170
1.677
1.519
2.096
0.537
7.244
0.412
2.322
806.811
5.401
5.431
6.290
5.279
5.454 5.957
1.517
3.718
2.237
4.417
2.044
2.542
Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch
Australian dollar
.7842 1.2752
China yuan
.1509 6.6286
Hong Kong dollar
.1281 7.8089
India rupee
.01537 65.048
Indonesia rupiah .0000740 13506
Japan yen
.008855 112.93
Kazakhstan tenge .002998 333.52
Macau pataca
.1243 8.0422
Malaysia ringgit
.2368 4.2230
New Zealand dollar
.7153 1.3980
Pakistan rupee
.00950 105.250
Philippines peso
.0195 51.394
Singapore dollar
.7370 1.3568
South Korea won .0008827 1132.88
Sri Lanka rupee
.0065087 153.64
Taiwan dollar
.03311 30.204
52-Week
High
Low
0.36
0.00
0.34
-3.11
0.99
26.36 24.96
9.79 9.70
29.46 24.17
11.78 6.36
38.83 30.34
34.16 16.43
19.67 36.03
16.25 13.24
20.65 1.98
6.55 -20.12
35.46 20.50
21.95 3.21
18.30 4.15
22.45 16.60
13.05 4.50
25.14
9.75
29.40
8.11
38.82
9.3
–2.6
–7.2
–6.7
–2.6
unch
–9.1
–3.5
0.4
–0.1
Track the Markets
Compare the performance of selected global stock
indexes, bond ETFs, currencies and commodities at
WSJ.com/TrackTheMarkets
–8.2
–4.6
0.7
–4.3
–0.1
–3.5
–0.1
1.6
–5.9
–3.2
0.8
3.6
–6.3
–6.2
3.5
–6.9
US$vs,
YTDchg
Wed
in US$ per US$ (%)
Country/currency
.03018 33.140 –7.5
.00004402 22720 –0.2
Thailand baht
Vietnam dong
Europe
Czech Rep. koruna
Denmark krone
Euro area euro
Hungary forint
Iceland krona
Norway krone
Poland zloty
Russia ruble
Sweden krona
Switzerland franc
Turkey lira
Ukraine hryvnia
UK pound
.04583 21.817 –15.1
.1583 6.3155 –10.7
1.1787 .8484 –10.7
.003825 261.43 –11.2
.009474 105.55 –6.6
.1256 7.9602 –7.9
.2783 3.5928 –14.2
.01740 57.462 –6.2
.1228 8.1421 –10.6
1.0186 .9817 –3.7
.2719 3.6778 4.4
.0378 26.4300 –2.4
1.3204 .7573 –6.5
Middle East/Africa
Bahrain dinar
Egypt pound
Israel shekel
Kuwait dinar
Oman sul rial
Qatar rial
Saudi Arabia riyal
South Africa rand
2.6521 .3771 –0.03
.0567 17.6470 –2.7
.2854 3.5042 –8.9
3.3071 .3024 –1.1
2.5987 .3848 –0.04
.2756 3.629 –0.3
.2666 3.7506
...
.0737 13.5769 –0.8
Close Net Chg % Chg YTD%Chg
WSJ Dollar Index 86.72
0.10 0.12 –6.69
Sources: Tullett Prebon, WSJ Market Data Group
Commodities
COMMODITIES
Wednesday
52-Week
Pricing trends on someClose
raw materials,
or commodities
Net chg % Chg
High
Low
DJ Commodity
Get real-time U.S. stock quotes and track most-active
stocks, new highs/lows and mutual funds. Plus,
deeper money-flows data and email delivery of key
stock-market data. Available free at WSJMarkets.com
-18.85
-14.80
-13.25
-13.05
-12.72
Asia-Pacific
2016 2017
1459.524
EMBI Global, J.P. Morgan
-2.20
-0.37
-0.64
-0.62
-0.59
U.S.-dollar foreign-exchange rates in late New York trading
Yen, euro vs. dollar; dollar vs.
major U.S. trading partners
1.50
9.47
2.13
4.19
4.13
4.05
Currencies
Forex Race
5
-50.5
-48.2
55.6
-6.4
...
* Common stocks priced at $5 a share or more with an average volume over 65 trading days of at least
5,000 shares =Has traded fewer than 65 days
10-yr Treasury, Ryan ALM 1733.850
DJ Corporate
379.773
Aggregate, Barclays Capital 1939.450
High Yield 100, Merrill Lynch 2866.305
Fixed-Rate MBS, Barclays 1985.680
Muni Master, Merrill
523.310
Treasury, Ryan ALM
SVU
3.18
1.11
0.84
4.50
6.98
ADOM
CREE
2.25
Close
Supervalu
Synchronoss Technologies
VirnetX Holding
Helios Matheson Analy
IZEA
52-Week
Low
% chg
22.20
8.95
3.84
13.05
11.95
LBIX
Cree
Spectrum Pharmaceuticals
Ignyta
Radcom
Immune Design
-34.2
39.6
-25.7
189.1
-46.1
16.28
19.40
0.45
16.45
1.14
Corporate Borrowing Rates and Yields
Bond total return index
QURE
High
-29.69
-25.49
-22.22
-20.12
-20.07
HAIR
USMC
-16.7 26.48 1.07
-0.7 26.31 0.53
878.2 3.69 -7.75
37.4 41.65 3.12
9141.4 2.00 38.89
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
Yield/Rate (%)
Last (l)Week ago
uniQure
Leading Brands
ADOMANI
MannKind
China Lending
Principal US Mega-Cap
Kayne Anderson Acqn Cl A
PS FTSE Intl Low Beta Eq
BlueLinx Holdings
iSh Edge MSCI Mult USA SC
3.75%
t
5-year Treasury
note yield
Somerset Savings Bank, SLA
2.88%
Bound Brook, NJ
732-560-1700
* Primary market NYSE, NYSE American NYSE Arca only.
†(TRIN) A comparison of the number of advancing and declining
issues with the volume of shares rising and falling. An
Arms of less than 1 indicates buying demand; above 1
indicates selling pressure.
-1.90
-1.25
-0.60
-1.65
-1.76
IMDZ
26.55
26.46
5.00
42.07
5.89
3.00
Manasquan Savings Bank
2.88%
Manasquan, NJ
732-292-8400
NYSE Arca
4.50
3.65
2.10
6.55
7.01
INFI
54,565
51,007
45,473
42,983
41,936
Benchmark
Yields
Treasury
yield
curve
andtoRates
Yield
maturity of current bills,
t
5-year adjustablet rate mortgage
Nasdaq
Total volume*1,717,639,326 163,765,399
Adv. volume* 948,008,262 94,591,433
Decl. volume* 732,275,149 66,482,304
Issues traded
3,045
1,287
Advances
1,648
777
Declines
1,247
475
Unchanged
150
35
New highs
155
203
New lows
43
28
Closing tick
35
29
Closing Arms†
1.02
1.26
Block trades*
6,909
1,110
Latest Session
Close Net chg % chg
SRAX
Symbol
* Volumes of 100,000 shares or more are rounded to the nearest thousand
3.53%
AKTX
Company
notes and bonds
Bankrate.com avg†:
Akari Therapeutics ADR
Social Reality Cl A
Infinity Pharmaceuticals
Immune Design
Restoration Robotics
52-Week
High
Low
s
U.S. consumer rates
Symbol
Volume % chg from Latest Session
(000) 65-day avg Close % chg
CREDIT MARKETS & CURRENCIES
Consumer Rates and Returns to Investor
Company
Volume Movers
38,780
36,047
35,599
35,232
33,465
T
Total volume* 677,609,904 14,225,999
Adv. volume* 321,202,858 4,986,274
Decl. volume* 348,156,971 8,848,224
Issues traded
3,074
335
Advances
1,526
137
Declines
1,422
177
Unchanged
126
21
New highs
164
2
New lows
31
6
Closing tick
37
30
Closing Arms†
1.10
1.47
Block trades*
5,708
93
Percentage Losers
Latest Session
Close Net chg % chg
Sources: SIX Financial Information; WSJ Market Data Group
WSJ
.COM
Low
SPY
Percentage Gainers...
Net chg
2960.40
383.38
259.19
The Global Dow
DJ Global Index
DJ Global ex U.S.
Interest rate
Last
SPDR S&P 500
545.78
1228.16
22.51
NYSE NYSE Amer.
Sources: SIX Financial Information; WSJ Market Data Group
International Stock Indexes
Americas
Brazil
Canada
Mexico
Chile
2561.26
192.66
-2.06
4.04
-0.24 -2.33
Philadelphia Stock Exchange
World
6624.22
6122.61
Late Trading
TR/CC CRB Index
Crude oil, $ per barrel
Natural gas, $/MMBtu
Gold, $ per troy oz.
595.26
-1.33
183.99
52.04
2.854
1279.90
-0.25
0.16
-0.108
-3.10
-0.22
600.13
527.06
-0.13 195.14
54.45
0.31
3.93
-3.65
-0.24 1346.00
166.50
42.53
2.56
1127.80
% Chg
8.91
YTD
% chg
4.94
-3.55 -4.43
0.85 -3.13
-9.97 -23.36
0.95 11.30
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
B8 | Thursday, October 19, 2017
NEW HIGHS AND LOWS
The following explanations apply to the New York Stock Exchange, NYSE Arca, NYSE MKT and
Nasdaq Stock Market stocks that hit a new 52-week intraday high or low in the latest session.
% CHG-Daily percentage change from the previous trading session.
Wednesday, October 18, 2017
52-Wk %
Sym Hi/Lo Chg Stock
Stock
NYSE highs - 164
AG Mortgage
MITT
AVX
AVX
AbbottLabs
ABT
AbbVie
ABBV
AllianzGIEqtyConv NIE
Ameren
AEE
AmerStWater
AWR
AmerWaterWorks AWK
AnnalyCapPfdF NLYpF
Anthem
ANTM
ApolloGlobalMgmt APO
AquaAmerica
WTR
ArtisanPtrsAsset APAM
BankofAmWtA BAC.WS.A
BankofAmerica BAC
BankofMontreal BMO
Bard CR
BCR
BarnesGroup
B
BectonDickinson BDX
BorgWarner
BWA
BostonScientific BSX
BoulderGrowth BIF
BoydGaming
BYD
Brink's
BCO
BroadridgeFinl
BR
BrookfieldMgt
BAM
CAI Intl
CAI
CBIZ
CBZ
CBRE Group
CBG
CGI Group
GIB
CalWtrSvc
CWT
CampingWorld CWH
CanPacRlwy
CP
Canon
CAJ
CharlesRiverLabs CRL
ChesapeakeLodging CHSP
ChesapeakeUtil CPK
ChoiceHotels
CHH
Chubb
CB
ColonyNorthPfdJ CLNSpJ
CerveceriasUnid CCU
ConstBrands B STZ.B
ConstBrands A STZ
CoreLogic
CLGX
Cummins
CMI
DellTechnologies DVMT
DolbyLab
DLB
DollarGeneral
DG
DouglasEmmett DEI
EtnVncEqtyInco EOI
EtnVncEqtyInco II EOS
EmbotellAndinaB AKO.B
EmbotellAndinaA AKO.A
Entergy
ETR
EssentGroup
ESNT
FMC
FMC
FairIsaac
FICO
Ferro
FOE
58.com
WUBA
FT EnhEquity
FFA
Flaherty&CrumDyn DFP
Forestar
FOR
Gallagher
AJG
GettyRealty
GTY
GreatPlainsEner GXP
GpoSupervielle SUPV
HFF
HF
HP
HPQ
HannonArmstrong HASI
HawaiianElec
HE
Hilton
HLT
HoulihanLokey
HLI
HyattHotels
H
IllinoisToolWks ITW
19.72
19.67
56.60
96.44
20.85
61.11
55.34
86.26
26.46
199.23
32.06
35.43
35.75
14.45
26.55
78.77
327.00
72.87
207.73
52.77
29.55
10.58
28.62
87.30
83.73
43.15
32.00
17.05
40.01
53.78
42.95
44.67
177.95
35.94
114.94
28.77
82.08
68.80
151.18
25.30
28.33
212.54
214.53
49.30
175.71
81.70
60.49
83.22
41.12
14.39
15.38
30.02
27.43
84.78
44.07
95.08
149.00
23.92
69.80
15.28
26.98
18.33
62.39
29.89
32.23
27.04
43.85
22.08
24.92
35.15
71.54
41.47
62.23
154.39
0.2
1.0
1.3
4.2
0.3
0.1
1.4
0.2
0.5
2.4
-0.1
0.1
2.3
2.5
1.1
0.7
0.8
0.7
2.3
0.7
0.4
...
2.3
-0.8
0.7
0.4
3.3
0.3
0.8
0.4
1.7
1.9
5.9
0.6
0.4
0.4
1.0
-0.1
0.7
0.4
0.9
2.4
-0.9
0.2
0.2
0.4
1.6
0.9
-0.7
0.1
0.4
1.1
1.7
0.1
1.3
-0.4
0.3
...
0.8
0.1
-1.3
4.3
0.4
...
-0.3
-1.5
1.2
0.8
1.3
0.5
-0.2
2.1
0.3
0.5
52-Wk %
Sym Hi/Lo Chg Stock
Ingevity
NGVT
Insperity
NSP
InvescoMtgPfdB IVRpB
InvescoMtg
IVR
InvescoMtg7.5%PfdC IVRpC
IronMountain
IRM
JPMorganChase JPM
JPMorganWt
JPM.WS
J&J
JNJ
JupaiHoldings
JP
KBR
KBR
KKRIncomeOppsRt KIOrw
Kemet
KEM
Kemper
KMPR
KimcoRealtyPfdL KIMpL
KornFerry
KFY
MGIC Investment MTG
MagnaIntl
MGA
McDonalds
MCD
Medifast
MED
MohawkIndustries MHK
Moody's
MCO
MorganStanley MS
MS Asia
APF
MyersIndustries MYE
NACCO Inds
NC
NL Industries
NL
NatlStoragePfdA NSApA
NationstarMtg NSM
NewGermanyFund GF
NextEraEnergyUn NEEpR
NovoNordisk
NVO
NuvCoreEqAlpha JCE
NuvDow30Dyn DIAX
NuvGlblHiIncmFd JGH
NuvTaxAdDivGr JTD
OnAssignment ASGN
OrmatTech
ORA
ParkerHannifin PH
PA REIT PfdD
PEIpD
Penumbra
PEN
PrincipalFin
PFG
ProtoLabs
PRLB
PureStorage
PSTG
PutnmHiInco
PCF
QuintilesIMS
Q
RELX
RENX
RE/MAX
RMAX
RadianGroup
RDN
ReinsuranceGrp RGA
Rogers
ROG
RoyalBkCanada RY
RoyalBkScotland RBS
RudolphTech
RTEC
SJW Group
SJW
SPX FLOW
FLOW
ScottsMiracleGro SMG
SensataTech
ST
ServiceNow
NOW
SpeedwayMotor TRK
Stantec
STN
StifelFinNts47
SFB
Stoneridge
SRI
Stryker
SYK
SunstoneHotelInv SHO
TRI Pointe
TPH
TableauSoftware DATA
TaiwanSemi
TSM
TelecomArgentina TEO
Teradyne
TER
Textainer
TGH
ThirdPointReins TPRE
Toll Bros
TOL
Torchmark
TMK
ToyotaMotor
TM
TransUnion
TRU
TravelportWorldwd TVPT
70.71
94.00
26.08
17.90
25.44
41.08
98.55
57.27
141.58
25.79
18.87
0.52
27.35
59.00
25.05
40.80
13.62
55.75
166.25
64.26
260.69
145.83
50.45
18.33
22.65
38.55
12.00
25.51
20.71
19.01
56.75
50.47
15.79
17.40
17.45
17.13
56.45
65.22
182.41
25.39
95.60
68.01
82.55
16.47
9.04
101.87
21.97
67.35
20.32
144.94
139.98
80.45
7.45
27.35
64.88
42.73
101.00
49.82
123.58
23.21
28.75
25.32
22.79
150.00
16.94
15.00
79.73
41.72
32.15
39.33
19.35
16.70
43.27
82.43
124.32
51.00
15.96
0.1
1.1
0.5
0.6
0.1
1.7
0.4
1.0
-0.1
6.6
0.7
-4.0
1.4
1.6
-0.2
1.7
3.3
3.0
0.2
-0.9
0.5
0.7
2.1
0.4
1.4
5.2
1.7
0.4
4.5
1.1
-0.1
1.7
0.5
0.9
-0.3
0.3
2.2
2.2
0.1
0.5
1.5
0.5
1.7
1.1
-0.2
1.3
0.9
...
1.1
0.9
0.3
0.8
2.1
1.7
1.7
1.8
0.5
1.1
-1.6
0.7
0.9
...
2.6
-0.1
1.1
1.4
-0.4
0.6
0.8
0.5
5.8
1.5
0.2
0.3
0.8
1.8
0.6
52-Wk %
Sym Hi/Lo Chg
Tri-Continental TY
TritonIntl
TRTN
TurningPoint
TPB
TwoHarborsPfdB TWOpB
Unifirst
UNF
UnitedHealth
UNH
Vishay
VSH
VMware
VMW
WEX
WEX
Walker&Dunlop WD
WasteConnections WCN
WstAstGlHiInco EHI
Yirendai
YRD
NYSE lows - 31
18.05 -2.1
AdvDrainageSys WMS
AllerganPfdA
AGNpA 673.09 -4.9
14.25 -1.8
BoardwalkPipe BWP
52.76 -1.4
BuckeyePtrs
BPL
15.48 -2.5
CONE Midstream CNNX
12.84 -1.7
Corts JCPen JBR JBR
15.33 -1.5
Coty
COTY
12.21 -0.6
DeutscheMuniIncmTr KTF
6.08 -2.1
Duff&PhelpsSelEn DSE
6.25 -3.1
EastmanKodak KODK
68.28 -3.2
EdgewellPersonal EPC
17.43 -2.1
EnergyTransfer ETP
23.70 -1.6
GenesisEnergy GEL
4.74 1.2
J.Jill
JILL
0.48 -4.0
KKRIncomeOppsRt KIOrw
11.56 -3.1
KeyEnergySvcs KEG
KinderMorganPfdA KMIpA 39.33 -0.3
2.41 -1.2
Luby's
LUB
4.19 -0.9
MFS Intermd
MIN
34.82 -2.2
NuSTAREnergy NS
18.10 -3.4
NuSTAR GP
NSH
11.21 -2.3
NuvEnerMLPTR JMF
9.95 -0.1
NuvHiIncmDec18 JHA
11.40 -2.9
PartyCity
PRTY
7.86 -2.5
PIMCO HiIncm PHK
12.99 -5.5
RangerEnergySvcs RNGR
12.33 0.5
Satrn JCPen
HJV
1.68 -1.7
SocialCapHedWt IPOA.WS
25.09
...
StifelFinNts47
SFB
17.08 -11.8
Supervalu
SVU
11.76 -0.4
Yext
YEXT
NYSE Arca highs - 203
ALPSIntlDivDogs IDOG
ALPSSectorDivDogs SDOG
ARKIndlInnovation ARKQ
BluStrTABIGIIsrael ITEQ
BuzzUSSentLdrs BUZ
CS FI LC Grwth FLGE
DeltaShS&P500Mgd DMRL
DiamondHillVal DHVW
DirexChinaBl3
YINN
DirexHlthcrBull3 CURE
DirexHmbldrBull3 NAIL
DirexS&P500Bl3 SPXL
DirexS&P500Bull2X SPUU
DirexS&P500Bl1.25 LLSP
DirexSemiBl3
SOXL
DirexTechBull3
TECL
S&P2xDivAristoETN SDYL
EcoLogicalStrat HECO
FidelityCoreDiv FDVV
FidelityDivRising FDRR
FidelityMSCIIT
FTEC
FidelityQualFactor FQAL
FidelityValFactor FVAL
FT Dow30EW
EDOW
EqCompassRiskMgr ERM
FT DJ SelMicro FDM
FT NYSE ArcaBiotch FBT
Biggest 1,000 Stocks | WSJ.com/stocks
How to Read the Stock Tables
The following explanations apply to NYSE,
NYSE Arca, NYSE MKT and Nasdaq Stock
Market listed securities. Prices are composite
quotations that include primary market trades
as well as trades reported by Nasdaq OMX
BXSM (formerly Boston), Chicago Stock
Exchange, CBOE, National Stock Exchange, ISE
and BATS.
The list comprises the 1,000 largest
companies based on market capitalization.
Underlined quotations are those stocks with
large changes in volume compared with the
issue’s average trading volume.
Boldfaced quotations highlight those issues
whose price changed by 5% or more if their
previous closing price was $2 or higher.
Stock
Net
Footnotes:
s-New 52-week high.
t-New 52-week low.
dd-Indicates loss in the most recent
four quarters.
FD-First day of trading.
h-Does not meet continued listing
standards
lf-Late filing
q-Temporary exemption from Nasdaq
requirements.
t-NYSE bankruptcy
v-Trading halted on primary market.
vj-In bankruptcy or receivership or
being reorganized under the
Bankruptcy Code, or securities
assumed by such companies.
Sym Close Chg
Stock
NYSE
ABB
ABB 25.06
AES
AES 11.13
Aflac
AFL 83.76
AGCO
AGCO 71.75
AT&T
T
35.71
s AbbottLabs ABT 55.77
s AbbVie
ABBV 96.04
Accenture ACN 137.42
AcuityBrands AYI 162.17
Adient
ADNT 85.45
AdvanceAuto AAP 87.81
AdvSemiEngg ASX 6.30
Aegon
AEG 5.82
AerCap
AER 52.33
Aetna
AET 157.43
AffiliatedMgrs AMG 195.46
AgilentTechs A
66.44
0.03
-0.06
...
0.17
-0.52
0.71
3.87
0.10
-1.47
0.29
-0.28
0.01
0.05
-0.10
1.53
1.67
0.32
Net
Sym Close Chg
Stock
Net
Sym Close Chg
AgnicoEagle AEM 44.82 -0.26 AmericaMovil AMX 18.24
Agrium
AGU 107.73 0.55 AmericaMovil A AMOV 18.08
AirProducts APD 153.20 -0.27 AmCampus ACC 43.87
AlaskaAir ALK 80.43 -0.09 AEP
AEP 73.01
Albemarle ALB 139.66 0.25 AmericanExpress AXP 92.08
Alcoa
AA 47.75 -0.02 AmericanFin AFG 104.42
AlexandriaRealEst ARE 123.17 -0.93 AIG
AIG 63.44
Alibaba
BABA 179.61 4.29 AmerTowerREIT AMT 137.48
Alleghany Y
560.43 4.16 s AmerWaterWorks AWK 86.22
Allegion
ALLE 87.60 0.60 Amerigas APU 44.91
Allergan
AGN 187.15-10.63 Ameriprise AMP 152.74
AllianceData ADS 228.38 1.44 AmerisourceBrgn ABC 80.49
AME 67.92
AllianceBernstein AB 25.20 0.20 Ametek
AlliantEnergy LNT 43.38 -0.06 Amphenol APH 86.62
Allstate
ALL 91.25 -0.16 AnadarkoPetrol APC 48.77
AllyFinancial ALLY 24.48 0.07 Andeavor ANDV 104.32
AlticeUSA ATUS 24.65 0.16 AB InBev BUD 125.80
Altria
MO 64.81 -0.06 AnnalyCap NLY 12.31
AlumofChina ACH 21.95 -0.49 AnteroResources AR 19.72
ANTM191.79
Ambev
ABEV 6.82 -0.01 s Anthem
s Ameren
AEE 61.01 0.06 Aon
AON 149.60
-0.10
-0.08
-0.53
-0.19
0.39
0.28
-0.19
-1.65
0.19
0.01
0.39
0.54
...
-0.08
-0.13
-0.13
-0.22
-0.01
0.07
4.53
0.40
Mutual Funds | WSJ.com/fundresearch
Explanatory Notes
Data provided by
e-Ex-distribution. f-Previous day’s quotation. g-Footnotes x and s apply. j-Footnotes e
and s apply. k-Recalculated by Lipper, using updated data. p-Distribution costs apply,
12b-1. r-Redemption charge may apply. s-Stock split or dividend. t-Footnotes p and r
apply. v-Footnotes x and e apply. x-Ex-dividend. z-Footnote x, e and s apply. NA-Not
available due to incomplete price, performance or cost data. NE-Not released by Lipper;
data under review. NN-Fund not tracked. NS-Fund didn’t exist at start of period.
Fund
Wednesday, October 18, 2017
Net YTD
NAV Chg %Ret Fund
A
American Century Inv
Ultra
44.07 -0.06
American Funds Cl A
31.47 +0.03
AmcpA p
AMutlA p 41.09 +0.05
27.23 -0.01
BalA p
12.96 -0.02
BondA p
CapIBA p
63.17 +0.12
CapWGrA 52.06 +0.12
56.94 +0.06
EupacA p
62.58 -0.03
FdInvA p
50.49 -0.03
GwthA p
10.50 +0.01
HI TrA p
ICAA p
41.03 +0.09
IncoA p
23.47 +0.02
44.58
...
N PerA p
46.86 +0.11
NEcoA p
NwWrldA 66.26 +0.07
56.28 +0.07
SmCpA p
13.06
...
TxExA p
WshA p
44.96 -0.01
B
Baird Funds
AggBdInst
CorBdInst
10.91 -0.02
11.27 -0.02
BlackRock Funds A
GlblAlloc p 20.24
...
BlackRock Funds Inst
22.81
...
EqtyDivd
20.37
...
GlblAlloc
7.86
...
HiYldBd
...
StratIncOpptyIns 9.97
Bridge Builder Trust
CoreBond
10.20 -0.02
D
Dimensional Fds
5GlbFxdInc 11.02 -0.01
EmgMktVa 30.26 -0.05
EmMktCorEq 22.43 -0.02
IntlCoreEq 14.19 +0.02
IntlVal
19.81 +0.04
21.51 +0.03
IntSmCo
23.48 +0.03
IntSmVa
US CoreEq1 21.86 +0.04
US CoreEq2 20.77 +0.05
US Small
36.44 +0.22
US SmCpVal 39.04 +0.21
US TgdVal 25.02 +0.10
38.52 +0.06
USLgVa
Dodge & Cox
Balanced 109.00 +0.12
14.05 +0.01
GblStock
Income
13.83 -0.01
Intl Stk
47.00 -0.03
201.31 +0.41
Stock
DoubleLine Funds
NA
...
TotRetBdI
NAV Chg %Ret Fund
Net YTD
NAV Chg %Ret
Fed TF A p 12.02 -0.01
NA
...
IncomeA p
RisDv A p 59.98 +0.03
Edgewood Growth Instituti
26.3 EdgewoodGrInst 29.37 -0.10 32.2 FrankTemp/Franklin C
Income C t
NA
...
17.3
FrankTemp/Temp A
13.2
GlBond A p 12.20 +0.02
Federated Instl
11.4
StraValDivIS 6.49 +0.01 12.8 Growth A p 27.01 +0.01
3.4
FrankTemp/Temp Adv
Fidelity
12.3
500IdxInst 89.62 +0.07 16.2 GlBondAdv p 12.15 +0.02
20.6
500IdxInstPrem 89.61 +0.07 16.2
28.9
500IdxPrem 89.61 +0.07 16.2
17.1
ExtMktIdxPrem r 62.56 +0.15 14.0 Harbor Funds
20.1
IntlIdxPrem r 43.22 +0.10 22.5 CapApInst 74.05 -0.03
6.8
70.33 +0.13
SAIUSLgCpIndxFd 13.74 +0.01 16.2 IntlInst r
14.6
Harding Loevner
10.7 TMktIdxF r 74.41 +0.08 15.8
NA
...
IntlEq
TMktIdxPrem
74.40
+0.08
15.8
26.2
30.3 USBdIdxInstPrem 11.62 -0.02 3.2
28.8 Fidelity Advisor I
Invesco Funds A
22.4 NwInsghtI 32.85 +0.02 23.0
11.24 +0.02
EqIncA
5.1 Fidelity Freedom
16.67 +0.01 13.0
14.0 FF2020
14.42 +0.01 13.9
FF2025
FF2030
18.05 +0.01 16.2 John Hancock Class 1
15.92 +0.01
Freedom2020 K 16.67 +0.01 NS LSBalncd
17.07 +0.02
LSGwth
3.8 Freedom2025 K 14.42 +0.01 NS
John Hancock Instl
18.06
+0.02
NS
Freedom2030
K
4.3
Freedom2035 K 15.14 +0.02 NS DispValMCI 23.95 +0.04
JPMorgan Funds
11.3 Freedom2040 K 10.64 +0.01 NS
MdCpVal L 39.84 +0.03
Fidelity Invest
JPMorgan R Class
23.60
...
13.7
Balanc
11.7
11.66 -0.02
85.88 -0.08 30.1 CoreBond
11.6 BluCh
124.26 +0.05 27.0
7.6 Contra
ContraK
124.25
+0.05
27.1
4.2
10.29
... 10.4 Lazard Instl
CpInc r
41.32 +0.04 24.1 EmgMktEq 19.72 -0.08
3.7 DivIntl
179.67 -0.20 31.4 Loomis Sayles Fds
GroCo
14.27
...
GrowCoK 179.62 -0.19 31.5 LSBondI
InvGB
7.94 -0.01 3.6 Lord Abbett A
4.28
...
ShtDurIncmA
p
11.30
-0.01
4.0
InvGrBd
2.2
52.38 +0.13 14.3 Lord Abbett F
28.1 LowP r
...
31.1 LowPriStkK r 52.34 +0.13 14.4 ShtDurIncm 4.27
104.10 -0.01 20.6
23.9 MagIn
106.86
+0.02
34.1
OTC
20.9
22.89
... 14.7 Metropolitan West
25.7 Puritn
NA
...
24.2 SrsEmrgMkt 21.35 +0.07 36.0 TotRetBd
NA
...
17.64
-0.02
32.0 TotRetBdI
SrsGroCoRetail
14.8
NA
...
12.9 SrsIntlGrw 16.23 +0.03 26.8 TRBdPlan
10.84 +0.03 18.3 MFS Funds Class I
8.4 SrsIntlVal
40.76
+0.10
ValueI
10.69
-0.01
3.9
TotalBond
4.9
MFS Funds Instl
5.0 Fidelity Selects
25.53 +0.10
230.55 -1.16 32.5 IntlEq
11.4 Biotech r
Mutual Series
First Eagle Funds
32.77 +0.08
60.23 +0.03 11.0 GlbDiscA
8.9 GlbA
18.0 FPA Funds
35.25 +0.04 9.4
4.0 FPACres
Oakmark Funds Invest
23.4 FrankTemp/Frank Adv
NA
... NA EqtyInc r
33.88 +0.09
12.3 IncomeAdv
FrankTemp/Franklin A
84.08 +0.23
Oakmark
7.49
... 5.5 OakmrkInt 29.12 +0.12
NA CA TF A p
E
F
3.3
NA
14.9
NA
4.0
14.6
4.2
H
30.7
20.4
NA
I
7.6
J
12.8
16.1
11.6
9.5
3.5
L
24.2
7.3
2.3
2.3
M
NA
NA
NA
13.7
26.0
8.9
O
11.4
16.0
28.3
52-Wk %
Sym Hi/Lo Chg Stock
FT TechAlphaDEX FXL
FT ValDivFd
FVD
FT ValueLine100 FVL
FlexMrnUSMktFtrTlt TILT
FlexShQualDivDef QDEF
FlexShQualDivDyn QDYN
FlexShQualityDiv QDF
GlbX ChinaFinls CHIX
GlbXSciBetaJapan SCIJ
GSActiveBetaUSLC GSLC
GuggBS2025HYCpBd BSJP
GuggDJIA Div
DJD
GuggS&P500PureGr RPG
GuggS&P400PrGrwth RFG
GuggS&P500Top50 XLG
GuggTR Bond
GTO
HartfordMultiUSEqu ROUS
HealthCareSelSect XLV
HullTacticalUS
HTUS
IQHedgeL/STracker QLS
iPathAIGCarbon GRN
iPathPBCopper CUPM
iPathPBIndstrMtls HEVY
iShCoreDivGrowth DGRO
iShCoreS&P500ETF IVV
iShS&PTotlUSStkMkt ITOT
iShCurrHdgIntlHY HHYX
iShCurHdgMSCIACWI HACW
iShCurHdgMSCIUS HAWX
iShCurrHdMSCIJapan HEWJ
iShUSHealthcare IYH
iShU.S.Technology IYW
iShEdgeMSCIUSASC SMLF
iShEdgeMSCIUSASize SIZE
iShGlobal100
IOO
iShMSCIAustriaCap EWO
iShMSCICanadaETF EWC
iShMSCIHongKong EWH
iShMSCIKLD400Soc DSI
iShMSCIKokusaiETF TOK
iShMSCIPacificxJp EPP
iShMSCIUSAESGSelct SUSA
iShMSCIWorldETF URTH
iShMorningstarLC JKD
iShMornLCGrowth JKE
iShRussell1000Gwth IWF
iShRussell1000ETF IWB
iShRussell3000ETF IWV
iShRussellTop200Gr IWY
iShRussellTop200 IWL
iShS&P100
OEF
iShS&PMC400Growth IJK
iShS&P500Growth IVW
iShGloblFinancials IXG
iShGlobalTechETF IXN
iShGlobalHealthcr IXJ
iShIntlDevProperty WPS
iShNorthAmerTech IGM
iShDowJonesUS IYY
iShChinaLC
FXI
iShRussellMCGrowth IWP
JanusVelTailLC TRSK
HancockIndustrials JHMI
HancockLC
JHML
HancockTech
JHMT
JPM DivRetIntl JPIH
JPM DivRetUS Eq JPUS
KraneEMCnsTech KEMQ
KraneMSCIChinaEnv KGRN
MeidellTactical
MATH
NationRiskBaseIntl RBIN
NationRiskBasedUS RBUS
PIMCO DynMultUS MFUS
PwrShDynLCValue PWV
PwrShDynMkt PWC
PwrShDynSemicon PSI
PwrShFTSE US1000 PRF
PwrShDynLC Grwth PWB
PwrShAPac xJapan PAF
PwrShRussMC EW EQWM
PwrShRussMCGrw PXMG
PwrShS&P500HiDiv SPHD
PwrShS&P500Mom SPMO
PwrShS&P500Qual SPHQ
Net
Sym Close Chg
Apache
APA 42.65
ApartmtInv AIV 44.19
s ApolloGlobalMgmt APO 31.73
s AquaAmerica WTR 35.30
Aramark
ARMK 42.96
ArcelorMittal MT 29.00
ArcherDaniels ADM 43.31
Arconic
ARNC 26.89
AristaNetworks ANET 189.94
ArrowElec ARW 83.47
AstraZeneca AZN 34.65
Athene
ATH 54.33
AtmosEnergy ATO 86.43
Autohome ATHM 60.10
Autoliv
ALV 125.34
AutoZone AZO 606.31
Avalonbay AVB 180.08
Avangrid
AGR 48.18
AveryDennison AVY 100.51
AxaltaCoating AXTA 28.76
BB&T
BBT 46.54
BCE
BCE 47.38
BHPBilliton BHP 41.50
BHPBilliton BBL 36.99
BP
BP 38.72
BRF
BRFS 14.31
BT Group BT 18.19
BWX Tech BWXT 59.33
BakerHughes BHGE 33.80
Ball
BLL 42.11
BancoBilbaoViz BBVA 8.57
BancodeChile BCH 93.70
BancoMacro BMA 124.61
BcoSantChile BSAC 31.44
BancoSantander SAN 6.61
BanColombia CIB 44.19
s BankofAmerica BAC 26.48
s BankofMontreal BMO 78.66
BankNY Mellon BK 54.46
BkNovaScotia BNS 64.71
Barclays
BCS 10.15
s Bard CR
BCR 327.00
BarrickGold ABX 16.17
BaxterIntl BAX 63.84
s BectonDickinson BDX 207.72
Berkley
WRB 68.77
Fund
Top 250 mutual-funds listings for Nasdaq-published share classes with net assets of
at least $500 million each. NAV is net asset value. Percentage performance figures
are total returns, assuming reinvestment of all distributions and after subtracting
annual expenses. Figures don’t reflect sales charges (“loads”) or redemption fees.
NET CHG is change in NAV from previous trading day. YTD%RET is year-to-date
return. 3-YR%RET is trailing three-year return annualized.
Net YTD
28.43 0.4
44.82 0.2
32.96 0.9
32.23 0.5
31.27 0.2
206.66 0.4
51.94 0.3
30.50 0.3
34.27 3.0
48.58 0.5
61.12 1.0
40.39 0.2
45.77 0.2
34.24 0.4
133.06 1.0
97.98 0.8
79.29 0.9
42.79 0.5
27.60 0.4
29.67 0.3
47.88 0.3
30.50
...
30.92 0.2
20.83 0.4
21.39 0.3
47.45 0.7
127.62 -0.5
Stock
Wall Street Journal stock tables reflect composite regular trading as of 4 p.m. and
changes in the closing prices from 4 p.m. the previous day.
Wednesday, October 18, 2017
26.12
...
38.49 3.8
18.99 -0.8
26.55 0.8
160.63 1.3
207.80 0.7
21.70 0.9
116.72 0.9
123.60 -0.3
56.33 1.2
70.82 0.5
10.40 -0.5
53.50 0.9
Stock
49.73
30.31
23.01
107.39
42.21
42.21
42.98
18.22
31.36
50.92
25.19
32.61
102.43
147.96
181.89
52.95
29.30
83.73
27.98
21.87
9.54
34.93
33.02
33.14
257.69
58.69
27.81
28.61
26.72
31.94
176.08
155.69
38.83
80.60
90.39
24.10
29.34
25.47
94.93
63.40
47.62
106.88
85.67
154.03
149.53
128.34
142.54
151.97
69.61
58.84
113.60
206.87
146.94
67.90
147.89
114.52
38.98
161.11
128.44
46.60
115.88
30.20
33.60
33.42
39.73
29.87
68.40
25.42
25.71
32.48
25.52
25.32
26.28
38.21
92.49
52.42
108.61
40.05
58.56
46.03
39.60
41.86
32.35
29.41
Stock
0.3
0.1
0.7
0.4
0.2
0.4
0.3
1.6
0.1
0.2
0.1
0.4
0.2
0.7
0.2
-0.2
0.5
0.1
0.3
-0.7
5.9
5.3
17.3
0.3
0.1
0.1
0.6
1.4
0.3
0.4
0.2
0.4
1.0
0.1
0.1
1.2
0.4
0.3
0.2
0.2
...
0.3
0.1
0.1
-0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.4
0.1
0.5
0.2
0.2
0.3
0.2
0.1
1.0
0.1
0.2
0.3
0.2
0.6
0.2
0.1
0.9
1.8
0.4
0.3
0.3
0.5
0.4
0.4
0.7
0.1
...
0.4
0.2
0.2
0.1
0.2
0.2
52-Wk %
Sym Hi/Lo Chg Stock
ProShS&P500xEner SPXE
ProShS&P500xTech SPXT
ProShShtVIXST SVXY
ProShrUltraDow30 DDM
ProShXinhuaChina25 XPP
ProShrUlHlthCr RXL
ProShrUltraQQQ QLD
ProShrUltraS&P SSO
ProShrUlSemi
USD
ProShrUlTech
ROM
ProShUltDow30 UDOW
ProShUltMC400 UMDD
ProShUltS&P500 UPRO
SPDRFactSetInnTech XITK
SPDRMFSSysGrowth SYG
SPDRMFSSysValueEqu SYV
SPDRMSCIACWIIMI ACIM
SPDRMSCICAStrat QCAN
SPDRMSCIDEStrat QDEU
SPDR NYSE Tech XNTK
SPDRPortfolioLC SPLG
SPDRS&P500Growth SPYG
SPDR Ptf TSM SPTM
SPDRRuss1000Mom ONEO
SPDR S&P500MidGr MDYG
SPDRS&P500Buyback SPYB
SPDRS&P500Fossil SPYX
SPDR US LC Low Vol LGLV
SchwabFundUSBrd FNDB
SchwabFundUSLrgCo FNDX
Schwab1000Index SCHK
SchwabUS BrdMkt SCHB
SchwabUS Div SCHD
SchwabUS LC
SCHX
SchwabUS LC Grw SCHG
SchwabUS LC Val SCHV
SPDR DJIA Tr
DIA
SPDR S&P 500 SPY
SPDR SP China GXC
SPDR S&P Div SDY
SPDR S&P Semi XSD
TechSelectSector XLK
UBS FIEnhLCGrw FBGX
VanEckFallAnglHYBd ANGL
VanEckGlbAltEn GEX
VanEckGlblSpinoff SPUN
VanEckIntlHYBd IHY
VanEckSemiconduc SMH
VanEckVietnam VNM
VangdInfoTech VGT
VangdDivApp
VIG
VangdGrowth
VUG
VangdHlthCr
VHT
VangdHiDiv
VYM
VangdLC
VV
VangdMegaCap MGC
VangdMegaGrwth MGK
VangdMegaVal MGV
VangdMCGrowth VOT
VangdS&P500 VOO
VangdS&P500 Grw VOOG
VangdS&PMC400 IVOO
VangdS&P400Grwth IVOG
VangdTotalStk
VTI
VangdValue
VTV
VelocityShVIXShrt XIVH
WBITacticalLCS WBIL
WBITacticalLCY WBIG
WBITacticalSMG WBIA
WisdTrEMxSOE XSOE
WisdTrEuropeHdgSM EUSC
WisdTrGlbxUSDiv DXUS
WisdTrGlbHiDiv DEW
WisdTrIntlHdgQual IHDG
WisdTrJpnHdgQuDiv JHDG
WisdTrJapanHdg DXJ
WisdTrUSEarn500 EPS
WisdTrUSHiDiv DHS
WisdTrUSLCDivFd DLN
WisdTrUSLCValueFd EZY
WisdTrUSTotalDivFd DTD
WisdTrUSTotalEarn EXT
XtrkrsMSCIAllChina CN
XtrkrsMSCIAWxUS DBAW
Net
Sym Close Chg
53.50
50.09
106.36
115.52
82.95
89.33
67.50
100.30
111.61
80.80
77.23
102.15
123.00
80.18
77.08
63.26
76.71
60.73
64.33
81.36
30.13
31.74
31.86
73.71
150.71
58.60
62.29
90.09
35.50
35.64
25.17
61.98
48.24
61.17
67.36
52.79
231.68
255.95
107.50
93.39
68.20
60.95
205.92
30.37
62.11
24.04
26.14
98.19
15.45
157.70
96.39
135.50
155.61
82.71
117.57
87.93
107.06
73.15
123.88
235.09
131.88
122.94
128.23
131.83
101.59
66.70
25.93
24.15
24.77
30.81
31.04
26.64
47.75
31.37
28.16
56.42
89.13
71.18
88.57
77.43
89.32
91.31
37.17
27.85
0.5
0.9
0.4
1.5
1.7
0.3
-0.2
0.1
0.9
0.8
2.1
0.9
0.3
0.6
0.7
0.4
0.2
0.4
0.9
0.5
0.3
0.1
0.3
0.3
0.4
0.4
0.2
0.3
0.4
0.2
...
0.1
0.3
0.1
-0.1
0.2
0.7
0.1
0.9
0.3
1.0
0.2
0.4
0.1
1.5
1.2
...
0.4
1.2
0.3
0.1
-0.1
0.1
0.2
0.1
0.1
-0.1
0.3
...
0.1
0.1
0.4
0.4
0.1
0.3
0.6
0.2
0.2
0.6
0.4
0.5
0.2
0.1
0.3
0.3
0.4
0.1
0.2
0.1
0.4
0.3
0.4
0.8
0.2
52-Wk %
Sym Hi/Lo Chg Stock
P
S
T
V
W
13.5
19.6
11.5
13.0
14.3
15.5
16.8
17.3
23.4
15.6
12.3
21.1
14.3
15.1
2.1
9.4
11.5
13.0
14.2
15.5
16.7
17.3
17.3
7.0
1.7
7.7
10.9
11.2
16.1
14.0
8.0
3.2
24.0
15.7
10.7
23.1
23.1
14.0
22.5
1.8
16.2
16.2
15.8
14.4
14.4
11.9
2.2
3.3
3.2
3.3
1.7
24.1
24.1
15.8
11.3
0.4
-0.5
-0.1
-2.9
-0.3
-0.2
-1.0
-0.7
-4.0
-1.8
-0.6
-0.8
-0.5
0.1
-0.1
-0.9
-2.1
-0.2
-1.2
-2.0
0.1
-0.9
0.1
-0.2
-0.7
-1.1
0.3
-0.6
NYSE American highs - 2
118.00
11.54
CCF
GLO
Chase
CloughGlblOpp
0.9
...
NYSE American lows - 6
AsteriasBiotherap AST
EMX Royalty
EMX
FieldPointWt
FPP.WS
ParamountGoldNV PZG
RegionalHlthPfdA RHEpA
VoltInfoSci
VISI
2.60
0.74
0.00
1.23
16.05
2.35
-7.0
0.7
-66.4
-2.7
-6.4
-2.1
Nasdaq highs - 155
AGNC InvPfdC
AGNCN 26.53
25.10
Adtran
ADTN
90.54
AdvEnergyInds AEIS
Alphabet A
GOOGL 1016.31
50.00
AltraIndlMotion AIMC
AmerSoftware AMSWA 12.43
55.61
AppliedMaterials AMAT
ArchCapitalPfdE ACGLP 24.97
28.28
ArenaPharm
ARNA
11.59
ArrowInvDWATact DWAT
41.73
AvisBudget
CAR
19.90
AxoGen
AXGN
31.20
BSB Bancorp
BLMT
54.19
BeaconRoof
BECN
348.84
Biogen
BIIB
6.21
BioLifeSols
BLFS
22.90
BoingoWireless WIFI
32.69
Brooks Auto
BRKS
85.39
CabotMicro
CCMP
21.40
ChefsWarehouse CHEF
30.00
ChinaInternet
CIFS
ChurchillDowns CHDN 211.58
Cimpress
CMPR 108.81
26.72
ClearBr AC Grw CACG
34.75
CodorusValleyBncp CVLY
122.21
Cognex
CGNX
36.65
Copart
CPRT
35.46
Cree
CREE
22.32
DavisUSEquity DUSA
BerkHathwy A BRK.A 281290240.00 CanNaturalRes CNQ 33.21 -0.05
BerkHathwy B BRK.B 187.85 0.46 s CanPacRlwy CP 177.10 9.94
BerryGlobal BERY 59.50 0.52 s Canon
CAJ 35.88 0.20
BestBuy
BBY 55.46 0.81 CapitalOne COF 86.66 0.59
Bio-RadLab A BIO 218.21 -0.73 CardinalHealth CAH 64.70 -0.38
Bio-RadLab B BIO.B 218.30 -4.55 Carlisle
CSL 101.17 0.88
BlackKnight BKI 45.65 -0.35 CarMax
KMX 75.26 -0.11
BlackBerry BB 11.25 -0.02 Carnival
CCL 67.46 -0.67
BlackRock BLK 477.50 1.95 Carnival
CUK 67.28 -0.55
BlackstoneGroup BX 33.49 0.27 Caterpillar CAT 131.29 0.75
t BoardwalkPipe BWP 14.43 -0.26 Celanese A CE 104.03 -0.24
Boeing
BA 260.04 1.42 Cemex
CX
8.03 -0.06
s BorgWarner BWA 52.39 0.37 CenovusEnergy CVE 9.79 -0.06
BostonProperties BXP 126.67 -1.39 Centene
CNC 93.54 -0.26
s BostonScientific BSX 29.52 0.12 CenterPointEner CNP 29.58 0.05
Braskem
BAK 29.22 0.01 CentraisElBras EBR 6.51 0.11
Bristol-Myers BMY 63.70 -0.48 CenturyLink CTL 18.65 -0.37
BritishAmTob BTI 64.02 -0.19 Chemours CC 56.12 -0.73
BrixmorProp BRX 18.93 -0.11 Chevron
CVX 118.15 -2.07
s BroadridgeFinl BR 83.61 0.62 ChinaEastrnAir CEA 25.18 0.25
s BrookfieldMgt BAM 42.97 0.15 ChinaLifeIns LFC 15.89 0.45
BrookfieldInfr BIP 44.31 0.74 ChinaMobile CHL 50.61 -0.05
Brown&Brown BRO 48.94 -0.07 ChinaPetrol SNP 74.58 -0.05
Brown-Forman A BF.A 56.57 -0.49 ChinaSoAirlines ZNH 34.93 -0.08
Brown-Forman B BF.B 55.76 -0.31 ChinaTelecom CHA 52.45 -0.38
t BuckeyePtrs BPL 53.25 -0.78 ChinaUnicom CHU 14.47
...
Bunge
BG 70.44 -0.77 Chipotle
CMG 318.24-11.06
BurlingtonStores BURL 89.32 0.52 s Chubb
CB 151.11 1.03
CBD Pao
CBD 25.20 0.96 ChunghwaTelecom CHT 33.95 -0.24
s CBRE Group CBG 39.96 0.30
Church&Dwight CHD 47.41 -0.29
CBS A
CBS.A 57.50 0.12
Cigna
CI 189.36 2.16
CBS B
CBS 56.96 0.30
CimarexEnergy XEC 115.03 -1.29
CF Industries CF 36.83 -0.17
Citigroup
C
73.12 0.93
s CGI Group GIB 53.58 0.21
CitizensFin CFG 37.18 0.50
CIT Group CIT 48.99 -0.04
Clorox
CLX 130.96 -0.91
CMS Energy CMS 47.81
...
Coach
COH 39.47 -0.17
CNA Fin
CNA 50.38 0.39
Coca-Cola KO 46.40 -0.12
CNOOC
CEO 129.79 -0.06
Coca-Cola Euro CCE 41.95 0.05
CPFLEnergia CPL 17.22 -0.05
Coca-Cola Femsa KOF 70.93 -0.26
CRH
CRH 35.81 -0.12
CVS Health CVS 74.10 1.47 Colgate-Palmolive CL 74.44 -0.52
CabotOil
COG 25.62 -0.26 ColonyNorthStar CLNS 12.53 -0.03
CMA 76.57 1.77
CamdenProperty CPT 92.50 -0.52 Comerica
SBS 9.82 -0.06
CampbellSoup CPB 45.64 -0.50 SABESP
CIBC
CM 90.54 0.82 ConagraBrands CAG 34.10 -0.11
CanNtlRlwy CNI 81.09 1.01 ConchoRscs CXO 133.06 -0.36
ConocoPhillips COP 49.71 -0.01
ConEd
ED 83.78 0.22
s ConstBrands A STZ 211.79 -1.85
s
ConstBrands
B
STZ.B 212.50 4.96
Net YTD
Net YTD
NAV Chg %Ret Fund
NAV Chg %Ret ContinentalRscs CLR 36.55 -0.76
6.0
2.8
1.4
23.8
5.2
11.9
1.4
2.2
3.3
1.7
24.1
15.8
23.0
11.3
11.3
7.7
10.9
14.4
19.30
34.41
19.99
6.30
34.39
32.03
18.22
8.15
40.95
8.46
16.00
19.62
11.72
37.21
31.58
15.83
24.09
13.05
10.00
17.80
30.25
20.50
14.70
44.99
11.79
18.34
23.36
28.58
PathS&P500VIXMT VXZ
iPathS&P500VIXST VXX
ColumbiaDivFixed DIAL
DirexChinaBr3
YANG
DirexS&P500Br3 SPXS
DirexS&P500Br1 SPDN
DirexSemiBear3 SOXS
DirexTechBear3 TECS
ETRACS2xMLevS&PMLP MLPZ
InfraCapMLPETF AMZA
ProShShtDow30 DOG
ProShShXinhuaCh25 YXI
ProShShtMC400 MYY
ProShShortQQQ PSQ
ProShShrtS&P500 SH
ProShUltVIXST UVXY
ProShUltShtDow30 SDOW
ProShUltProShS&P SPXU
ProShUltShDow30 DXD
ProShXinhuaChina25 FXP
ProShrUSHlthCr RXD
ProShUltMC400 MZZ
ProShUltShtQQQ QID
ProShUltShtS&P500 SDS
ProShrUSSemi SSG
ProShrUSTech
REW
ProShsVIXMTFut VIXM
ProShsVIXSTFut VIXY
-0.11
-0.05
-0.02
0.04
-0.01
0.14
-0.36
0.05
-0.67
0.39
-0.13
0.10
0.21
1.99
-0.47
-1.56
0.06
0.07
-1.07
0.37
0.02
-0.04
-0.92
-0.56
0.03
0.23
0.08
-0.10
0.01
0.13
0.07
0.29
-1.26
0.38
0.06
0.14
0.28
0.56
0.50
0.28
0.08
2.46
-0.05
-0.08
4.65
0.32
Old Westbury Fds
MuLTAdml 11.72 -0.01
NA
... NA MuLtdAdml 11.00 +0.01
LrgCpStr
Oppenheimer Y
...
MuShtAdml 15.80
42.49 +0.08 32.9 PrmcpAdml r134.77 +0.35
DevMktY
43.03 +0.15 24.1 REITAdml r 119.63 -0.09
IntGrowY
SmCapAdml 68.47 +0.19
STBondAdml 10.44 -0.01
STIGradeAdml 10.68 -0.01
Parnassus Fds
43.30 +0.06 11.1 TotBdAdml 10.78 -0.02
ParnEqFd
TotIntBdIdxAdm 21.87 -0.02
PIMCO Fds Instl
NA
... NA TotIntlAdmIdx r 29.97 +0.05
AllAsset
TotRt
10.31 -0.02 5.0 TotStAdml 64.09 +0.07
14.16 +0.03
TxMIn r
PIMCO Funds A
39.59 +0.09
IncomeFd
NA
... NA ValAdml
WdsrllAdml 68.70 +0.11
PIMCO Funds D
IncomeFd
NA
... NA WellsIAdml 65.06 -0.07
WelltnAdml 73.41 +0.06
PIMCO Funds Instl
NA
... NA WndsrAdml 78.56 +0.09
IncomeFd
VANGUARD FDS
PIMCO Funds P
26.20
...
NA
... NA DivdGro
IncomeP
Price Funds
HlthCare r 214.96 -0.70
...
95.37 +0.10 31.3 INSTTRF2020 22.46
BlChip
29.56 +0.05 12.9 INSTTRF2025 22.73 +0.01
CapApp
34.64 +0.06 11.6 INSTTRF2030 22.91 +0.01
EqInc
68.82 +0.06 16.0 INSTTRF2035 23.10 +0.01
EqIndex
68.89 +0.10 29.4 INSTTRF2040 23.29 +0.02
Growth
74.38 -0.16 25.9 INSTTRF2045 23.43 +0.03
HelSci
38.68 +0.06 32.3 IntlVal
InstlCapG
39.19 +0.06
19.29 +0.04 26.2 LifeGro
IntlStk
33.03 +0.03
15.44 +0.06 20.5 LifeMod
IntlValEq
26.85 +0.01
MCapGro
91.18 +0.07 21.0 PrmcpCor
26.87 +0.02
MCapVal
31.03 +0.04 6.8 SelValu r
32.90 +0.05
N Horiz
54.93 +0.09 26.8 STAR
27.07
...
9.51 -0.01 3.6 STIGrade
N Inc
10.68 -0.01
OverS SF r 11.38 +0.04 25.5 TgtRe2015 15.88
...
23.15 +0.02 13.4 TgtRe2020 31.52 +0.01
R2020
17.84 +0.02 15.1 TgtRe2025 18.47
R2025
...
26.27 +0.03 16.6 TgtRe2030 33.36 +0.02
R2030
19.20 +0.03 17.9 TgtRe2035 20.49 +0.02
R2035
27.58 +0.05 18.8 TgtRe2040 35.27 +0.03
R2040
38.34 +0.09 13.9 TgtRe2045 22.16 +0.03
Value
PRIMECAP Odyssey Fds
TgtRe2050 35.64 +0.04
35.68 +0.12 24.6 TgtRetInc
Growth r
13.55
...
Principal Investors
TotIntBdIxInv 10.94 -0.01
NA
... NA WellsI
DivIntlInst
26.85 -0.03
Prudential Cl Z & I
42.51 +0.04
Welltn
TRBdZ
NA
... NA WndsrII
38.71 +0.06
VANGUARD INDEX FDS
236.61 +0.19
500
Schwab Funds
ExtndIstPl 202.82 +0.49
S&P Sel
40.00 +0.03 16.2 SmValAdml 55.42 +0.17
TotBd2
10.74 -0.02
17.92 +0.03
TotIntl
64.06 +0.07
TotSt
TIAA/CREF Funds
EqIdxInst
19.21 +0.02 15.8 VANGUARD INSTL FDS
33.93
...
IntlEqIdxInst 20.29 +0.05 22.6 BalInst
DevMktsIndInst 14.18 +0.03
Tweedy Browne Fds
NA
... NA DevMktsInxInst 22.17 +0.05
GblValue
ExtndInst
82.19 +0.20
GrwthInst 69.60 -0.05
InPrSeIn
10.47 -0.01
VANGUARD ADMIRAL
233.46 +0.19
500Adml 236.62 +0.18 16.2 InstIdx
233.47 +0.18
33.92
... 10.7 InstPlus
BalAdml
... 5.1 InstTStPlus 57.49 +0.07
CAITAdml 11.86
CapOpAdml r155.95 +0.27 25.5 MidCpInst 40.77 +0.03
37.30 -0.06 27.7 MidCpIstPl 201.05 +0.13
EMAdmr
EqIncAdml 75.92 +0.02 13.3 SmCapInst 68.47 +0.19
ExtndAdml 82.19 +0.20 14.0 STIGradeInst 10.68 -0.01
10.78 -0.02
GNMAAdml 10.52 -0.02 2.0 TotBdInst
GrwthAdml 69.60 -0.05 22.5 TotBdInst2 10.74 -0.02
HlthCareAdml r 90.68 -0.30 19.6 TotBdInstPl 10.78 -0.02
HYCorAdml r 5.99 +0.01 7.3 TotIntBdIdxInst 32.81 -0.04
InfProAd
25.69 -0.03 1.7 TotIntlInstIdx r119.83 +0.17
IntlGrAdml 94.92 +0.16 41.0 TotItlInstPlId r119.86 +0.18
64.10 +0.07
ITBondAdml 11.44 -0.02 3.9 TotStInst
39.59 +0.09
ITIGradeAdml 9.82 -0.01 4.2 ValueInst
LTGradeAdml 10.62 -0.05 9.1
MidCpAdml 184.54 +0.12 14.4
MuHYAdml 11.43 -0.01 7.0 Western Asset
NA
...
... 4.8 CorePlusBdI
MuIntAdml 14.24
0.6
0.3
0.3
0.5
0.5
0.2
0.4
0.5
NYSE Arca lows - 28
Net
Sym Close Chg
Stock
28.89
31.70
28.78
28.54
42.02
31.28
30.75
34.11
XtrkrsMSCIAPxJapan DBAP
XtrkrsMSCIEAFE DBEF
XtrkrsMSCIEurope DBEU
XtrkrsMSCIGermany DBGR
XtrkrsMSCIJapan DBJP
XtrkrsMSCISKorea DBKO
XtrkrsRussell1000 DEUS
XtrkrsRussell2000 DESC
0.9
-6.5
1.1
0.2
1.6
1.0
0.4
0.2
2.6
0.4
0.1
1.0
0.7
2.0
...
5.7
2.6
-0.9
1.6
1.4
28.7
...
1.1
-0.1
1.4
1.0
0.1
16.4
0.1
52-Wk %
Sym Hi/Lo Chg Stock
0.5
1.3
1.5
2.2
-0.3
1.8
...
4.3
2.4
0.4
0.2
0.4
0.8
0.8
0.1
0.3
0.5
0.4
0.9
0.4
1.0
0.2
0.3
0.5
...
0.3
5.6
5.2
...
0.3
0.3
0.6
-6.3
1.2
1.4
1.0
3.0
13.2
1.5
0.1
1.2
5.0
0.1
0.5
0.1
0.2
0.4
0.9
0.5
0.3
0.3
15.2
0.3
3.1
-0.2
0.4
0.5
LimelightNetworks LLNW
MCBCHoldings MCFT
MDC Partners
MDCA
MillAcqn Wt
MIIIW
MKS Instrum
MKSI
Marriott
MAR
MaximIntProducts MXIM
MazorRobotics MZOR
MercerIntl
MERC
MonarchCasino MCRI
Morningstar
MORN
NMI Holdings
NMIH
NatlEnerSvs
NESR
NuvNasd100Dyn QQQX
OconeeFederalFin OFED
Omnicell
OMCL
Onvia
ONVI
Orbotech
ORBK
OrigoAcqnUn
OACQU
OspreyEnergyWt OSPRW
OtterTail
OTTR
PRGXGlobal
PRGX
PTC
PTC
Paylocity
PCTY
PennNational
PENN
PeregrinePharmPf PPHMP
PilgrimPride
PPC
PinnacleEnt
PNK
Potlatch
PCH
PwrShBuybackAch PKW
PwrShDivAch
PFM
PwrShDynConsStp PSL
PwrShFTSEIntlLow IDLB
PwrShIntlBuyBack IPKW
PwrShQQQ 1
QQQ
PwrShS&P SC Fin PSCF
PrincipalUSMega USMC
ProgressSoftware PRGS
ProShUltPrQQQ TQQQ
RCI Hospitality RICK
RigelPharm
RIGL
SG Blocks
SGBX
SareptaTherap SRPT
SensusHealthWt SRTSW
Sigmatron
SGMA
Silicom
SILC
SpectrumPharm SPPI
SpringBkPharm SBPH
TRowePrice
TROW
TheBancorp
TBBK
TrustcoBank
TRST
TwinDisc
TWIN
2U
TWOU
UltraClean
UCTT
UnitedFinBncp
UBNK
UTStarcom
UTSI
VangdRuss1000 VONE
4.52
22.85
11.95
0.60
100.80
116.67
50.03
59.59
13.74
41.83
86.35
14.05
9.74
23.29
29.70
52.95
9.00
44.30
11.35
0.95
45.95
7.40
60.84
52.00
25.21
24.35
30.57
25.12
53.10
56.50
25.13
62.38
29.46
35.60
149.21
54.66
26.36
41.63
123.07
28.05
4.33
6.40
52.67
3.00
9.35
60.16
21.95
17.76
95.95
8.58
9.30
22.25
60.92
34.59
18.99
3.18
117.68
2.8
1.4
...
-3.8
1.0
0.6
...
6.5
-0.4
2.4
0.9
0.4
0.3
...
1.9
2.4
1.1
0.9
2.7
11.8
1.2
5.9
0.6
0.9
5.1
0.6
3.1
2.7
1.4
0.4
...
0.5
0.3
0.1
-0.1
0.8
0.4
1.1
-0.4
0.3
-5.0
9.4
-0.6
68.5
1.0
2.5
36.0
17.5
1.1
3.4
1.4
3.4
1.1
1.6
-1.3
-2.9
0.1
52-Wk %
Sym Hi/Lo Chg
VangdRuss1000Grw VONG
VangdRuss3000 VTHR
VSInverseVIXSTerm XIV
VicShUSLCHiDivVol CDL
VikingTherap
VKTX
VikingTheraWt VKTXW
WillametteValley WVVI
WillisTwrsWatson WLTW
WisdTrChinaxSOE CXSE
WisdTrUSQltyDiv DGRW
XOMA
XOMA
ZebraTech
ZBRA
131.62 0.1
117.77 0.3
110.75 0.4
44.09 0.3
2.88 25.6
1.37 26.6
8.86 1.2
160.16 0.5
83.21 1.1
39.08 0.4
24.92 1.5
113.12 1.7
Nasdaq lows - 43
ADOMANI
ADOM
AchieveLifeSci
ACHV
AlcentraCapital ABDC
AndinaAcqnIIUn ANDAU
Atomera
ATOM
AxovantSciences AXON
BlackhawkNtwk HAWK
BorqsTechnologies BRQS
BroadwindEnergy BWEN
CUI Global
CUI
ChinaBiologic
CBPO
Cinedigm
CIDM
ConcordiaIntl
CXRX
ConstellAlphaCap CNACU
DHX Media VV DHXM
DifferentialBrds DFBG
EnergyXXIGulfCoast EXXI
ExpressScripts ESRX
FFBW
FFBW
FTD
FTD
FrontierComm
FTR
FulgentGenetics FLGT
GenMarkDiagn GNMK
I-AM Capital Wt IAMXW
JMU
JMU
JasonIndustriesWt JASNW
KraftHeinz
KHC
MobileIron
MOBL
OrthoPediatrics KIDS
ProfDiversity
IPDN
ProShUltraProShQQQ SQQQ
RennovaHealth RNVA
RestorationRob HAIR
SenesTech
SNES
Trevena
TRVN
US Gold
USAU
VS2xVIXMedTerm TVIZ
VS2xVIXShortTerm TVIX
VSVIXShortTerm VIIX
Vivus
VVUS
WheelerREITPfdB WHLRP
WheelerREITPfdD WHLRD
Xperi
XPER
3.96
1.84
10.15
10.20
3.31
5.51
32.60
4.35
2.84
2.78
78.94
1.11
0.96
8.22
3.70
1.10
8.50
55.80
11.06
11.84
11.25
3.60
8.00
0.25
1.10
0.04
76.67
3.20
17.03
3.40
24.84
1.22
6.98
1.52
1.75
1.40
11.02
8.64
14.56
0.77
19.34
20.01
21.70
-13.3
-7.6
-1.9
-6.8
-5.2
-6.1
-0.9
-5.5
-3.0
3.1
-2.7
-6.2
-3.0
...
-3.2
-12.1
0.3
1.0
-1.4
-2.3
...
-3.4
-0.6
3.6
1.8
-11.9
-0.6
-6.6
-1.4
-3.5
0.3
-12.8
-20.1
-1.8
-0.5
-4.8
0.6
-0.9
-0.4
-2.2
-6.2
-3.5
-2.9
IPO Scorecard
Performance of IPOs, most-recent listed first
% Chg From
Wed3s Offer 1st-day
close ($) price close
Company SYMBOL
IPO date/Offer price
Qudian
QD Oct. 18/$24.00
OptiNose
OPTN Oct. 13/$16.00
CarGurus
CARG Oct. 12/$16.00
OrthoPediatrics
KIDS Oct. 12/$13.00
29.18
21.6
...
19.14
19.6
0.7
28.14
75.9
2.0
17.50
34.6
–8.9
7.01
Restoration Robotics
HAIR Oct. 12/$7.00
% Chg From
Wed3s Offer 1st-day
close ($) price close
Company SYMBOL
IPO date/Offer price
Switch
19.15
SWCH Oct. 6/$17.00
Rhythm Pharmaceuticals 23.87
RYTM Oct. 5/$17.00
PQ Grp Hldgs
17.00
PQG Sept. 29/$17.50
Deciphera Pharmaceutical 19.96
DCPH Sept. 28/$17.00
0.1 –29.3
19.45
Nightstar Thera
NITE Sept. 28/$14.00
–8.1
12.6
40.4 –20.5
–2.9
–1.4
17.4
13.1
38.9 –19.0
Sources: WSJ Market Data Group; FactSet Research Systems
Net
Sym Close Chg
Stock
25.04
33.31
10.78
15.94
233.88
30.60
176.74
15.25
56.91
25.87
48.65
43.14
33.45
48.89
55.85
20.78
37.56
63.15
19.99
70.73
29.88
24.99
91.73
31.59
33.40
17.90
58.55
6.98
14.29
18.56
19.90
15.74
4.73
30.60
22.77
204.29
34.70
18.30
62.82
28.22
40.29
50.73
65.41
64.47
51.69
70.17
75.47
66.35
59.61
56.07
166.50
11.98
37.70
200.91
13.32
29.57
26.43
DavisWorldwide DWLD
Diodes
DIOD
DraperOakwood DOTAU
ElectroScientific ESIO
EnstarGroup
ESGR
Entegris
ENTG
Facebook
FB
Ferroglobe
GSM
FirstDefiance
FDEF
FT CanadaAlpha FCAN
FT CapStrength FTCS
FT CloudComp SKYY
FT NasdTechDiv TDIV
FT GerAlpha
FGM
FT LC CoreAlpha FEX
FT LC US Equity RNLC
FT MC GrwthAlpha FNY
FT MCGrAlpDX FAD
FT NasdCleanEdge QCLN
FT Nasd100Tech QTEC
FT NasdSemicon FTXL
FT RBAQualIncm QINC
FlexSTOXXGlbESGImp ESGG
FlexShUSQualLC QLC
Fonar
FONR
FormFactor
FORM
GRAVITY
GRVY
GilatSatellite
GILT
GladstoneLand LAND
GlbXConsciousCos KRMA
GlbXLongevityThem LNGR
GlbXSuperDivdREIT SRET
GluMobile
GLUU
HeritageFin
HFWA
HollysysAuto
HOLI
IPG Photonics
IPGP
Ichor
ICHR
Ignyta
RXDX
Insulet
PODD
IntegratedDevice IDTI
Intel
INTC
InteractiveBrkrs IBKR
IonisPharma
IONS
iShAsia50ETF
AIA
iShCoreS&PUSGrowth IUSG
iShMSCIACWIETF ACWI
iShMSCIACxJpn AAXJ
iShMSCIChinaETF MCHI
iShMSCIGlbImpact MPCT
iShMSCIUSAESGOpt ESGU
iShPHLXSemicond SOXX
KrystalBiotech
KRYS
LKQ
LKQ
LamResearch
LRCX
LayneChristensen LAYN
LeggMasonDev DDBI
LeggMasonSCQualVal SQLV
52-Wk %
Sym Hi/Lo Chg Stock
Cooper
COO 235.78
Corning
GLW 29.92
t Coty
COTY 15.76
Credicorp
BAP 207.86
CreditSuisse CS 15.91
CrestwoodEquity CEQP 23.65
CrownCastle CCI 100.96
CrownHoldings CCK 59.82
Cullen/Frost CFR 97.23
s Cummins
CMI 175.02
DTE Energy DTE 110.55
DXC Tech DXC 91.57
Danaher
DHR 86.05
Darden
DRI 81.96
DaVita
DVA 57.72
Deere
DE 128.72
s DellTechnologies DVMT 81.35
DelphiAutomotive DLPH 97.73
DeltaAir
DAL 52.86
DeutscheBank DB 16.89
DevonEnergy DVN 35.22
Diageo
DEO 135.58
DigitalRealty DLR 123.85
DiscoverFinSvcs DFS 65.39
Disney
DIS 98.25
s DolbyLab
DLB 60.17
s DollarGeneral DG 82.80
DominionEner D
78.88
Domino's
DPZ 187.79
Donaldson DCI 46.97
s DouglasEmmett DEI 40.72
Dover
DOV 93.57
DowDuPont DWDP 70.78
DrPepperSnap DPS 89.15
DrReddy'sLab RDY 36.44
DukeEnergy DUK 87.04
DukeRealty DRE 29.14
ENI
E
32.73
EOG Rscs EOG 96.66
EQT
EQT 62.94
EQT Midstream EQM 73.19
EastmanChem EMN 88.06
Eaton
ETN 77.97
EatonVance EV 51.53
Ecolab
ECL 131.70
Ecopetrol
EC 10.04
EdisonInt
EIX 77.85
EdwardsLife EW 111.20
EmersonElectric EMR 65.51
EnbridgeEnPtrs EEP 15.05
Net
Sym Close Chg
Stock
Enbridge
ENB 40.46
Encana
ECA 11.79
EnelAmericas ENIA 10.76
EnelChile
ENIC 5.97
EnelGenChile EOCC 27.19
EnergyTrfrEquity ETE 17.45
t EnergyTransfer ETP 17.76
s Entergy
ETR 84.66
EnterpriseProd EPD 25.48
Equifax
EFX 110.62
EquityLife ELS 87.29
EquityResdntl EQR 66.72
EssexProp ESS 261.21
EsteeLauder EL 109.98
EverestRe RE 235.00
EversourceEner ES 61.44
Exelon
EXC 39.62
ExtraSpaceSt EXR 81.92
ExxonMobil XOM 82.76
s FMC
FMC 94.06
FactSet
FDS 180.15
FederalRealty FRT 128.53
FedEx
FDX 222.30
Ferrari
RACE 116.56
FiatChrysler FCAU 17.51
FibriaCelulose FBR 15.71
FidelityNatlFin FNF 35.02
FNFV Group FNFV 17.90
FidelityNtlInfo FIS 94.81
s 58.com
WUBA 69.36
FirstData
FDC 18.24
FirstRepBank FRC 96.77
FirstEnergy FE 31.99
FleetCorTech FLT 165.96
Flowserve FLS 44.62
Fluor
FLR 42.55
FomentoEconMex FMX 92.00
FordMotor F
12.19
ForestCIty A FCE.A 25.02
Fortis
FTS 37.25
Fortive
FTV 71.62
FortBrandsHome FBHS 65.35
Franco-Nevada FNV 79.52
FranklinRscs BEN 44.80
Freeport-McMoRan FCX 14.83
FreseniusMed FMS 48.49
GGP
GGP 21.18
s Gallagher AJG 62.13
Gap
GPS 26.66
Gartner
IT 122.27
-0.20
0.25
-0.24
0.71
-0.11
-0.25
-0.42
-0.22
1.39
0.30
0.39
-0.54
0.79
0.40
1.23
0.03
0.36
0.49
0.10
0.18
-0.51
0.95
1.13
0.73
-0.11
0.97
0.70
-0.08
-4.48
0.13
-0.30
-0.48
-0.10
-0.22
-0.01
-0.47
0.19
-0.06
-0.79
-0.38
-0.68
0.76
-0.10
0.54
-0.88
0.07
0.25
1.15
0.03
-0.35
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
-0.84 Gazit-Globe GZT 9.79 0.06 HuntingtonIngalls HII 234.89 -0.34
0.37 GeneralDynamics GD 210.39 -1.15 Huntsman HUN 28.86 -0.34
61.91 0.21
-0.12 GeneralElec GE 23.12 -0.07 s HyattHotels H
-0.13 GeneralMills GIS 52.25 0.55 ICICI Bank IBN 7.94 -0.38
0.09 GeneralMotors GM 45.12 0.10 ING Groep ING 18.55 0.18
G
29.72 0.18 Invesco
IVZ 36.79 0.60
-0.29 Genpact
IEX 124.53 0.33
-0.39 GenuineParts GPC 98.04 1.18 IDEX
GGB 3.62 0.09 s IllinoisToolWks ITW 153.76 0.69
0.06 Gerdau
GIL 31.39 0.38 Infosys
INFY 14.58 0.12
-0.65 Gildan
91.22 0.12
2.04 GlaxoSmithKline GSK 41.01 0.18 Ingersoll-Rand IR
INGR 123.38 -0.24
-0.19 GlobalPayments GPN 96.87 -0.81 Ingredion
GDDY 44.41 0.56 ICE
ICE 68.20 0.03
-0.16 GoDaddy
GG 13.15 0.01 InterContinentl IHG 54.32 0.09
-0.17 Goldcorp
IBM 159.53 12.99
-0.53 GoldmanSachs GS 242.03 5.94 IBM
Graco
GGG 126.80 1.58 IntlFlavors IFF 147.28 -1.30
-1.40
GWW208.81 3.39 IntlPaper
-0.30 Grainger
IP
58.02 -0.12
0.02 s GreatPlainsEner GXP 32.07 -0.11 Interpublic IPG 21.23 0.19
-0.27 GpoAvalAcciones AVAL 9.08 0.09 InvitationHomes INVH 22.80 0.15
-0.20 GpFinSantandMex BSMX 8.98 -0.10 s IronMountain IRM 40.79 0.68
-0.36 GrupoTelevisa TV 23.55 -0.10 IsraelChemicals ICL
4.35 0.01
0.68 GuidewireSoftware GWRE 76.54 -0.67 ItauUnibanco ITUB 13.95 -0.03
-1.10 HCA Healthcare HCA 77.45 0.63 s JPMorganChase JPM 97.99 0.37
HCP 26.47 -0.01 JacobsEngineering JEC 58.17 -0.06
2.20 HCP
0.79 HDFC Bank HDB 95.27 0.67 JamesHardie JHX 14.67 0.45
HPQ 21.72 0.17 JanusHenderson JHG 35.28 0.15
0.17 s HP
HSBC 49.49 0.38 s J&J
-0.72 HSBC
JNJ 140.68 -0.11
0.62 Halliburton HAL 43.77 -0.69 JohnsonControls JCI 40.66 -0.54
0.10 Hanesbrands HBI 23.21 0.08 JonesLangLaSalle JLL 131.75 1.21
0.43 HarleyDavidson HOG 48.02 0.50 JuniperNetworks JNPR 26.08 -0.03
HRS 134.84 -1.25 KAR Auction KAR 48.26 0.21
0.56 Harris
0.16 HartfordFinl HIG 55.52 -0.29 KB Fin
KB 50.29
...
0.31 HealthcareAmer HTA 29.89 -0.03 KKR
KKR 20.22 0.04
HEI 89.69 0.41 KT
-0.18 Heico
KT 14.51 -0.10
HEI.A 74.85 0.45 KSCitySouthern KSU 102.81 1.34
3.32 Heico A
0.04 Helmerich&Payne HP 51.20 -1.05 Kellogg
K
61.79 0.05
HLF 75.33 -2.25 KeyCorp
0.01 Herbalife
KEY 18.58 0.39
HSY 110.05 -0.77 KeysightTechs KEYS 42.85 0.35
-1.03 Hershey
HES 45.87 -0.09 KilroyRealty KRC 72.95 0.12
-0.08 Hess
-0.05 HewlettPackard HPE 14.70 0.09 KimberlyClark KMB 117.30 -0.98
HLT 71.06 -0.16 KimcoRealty KIM 19.18 -0.08
0.09 s Hilton
0.13 HollyFrontier HFC 36.09 -0.23 KinderMorgan KMI 18.58 -0.10
-0.73 HomeDepot HD 163.45 0.10 Knight-Swift KNX 39.27 0.81
-0.12 HondaMotor HMC 30.46 0.05 Kohl's
KSS 43.63 0.33
0.41 Honeywell HON 143.44 0.01 KoninklijkePhil PHG 41.15 0.63
-0.10 HormelFoods HRL 31.34 -0.17 KoreaElcPwr KEP 17.50 -0.11
0.39 DR Horton DHI 41.51 0.02 Kroger
KR 20.67 0.19
-0.39 HostHotels HST 19.85 0.51 Kyocera
KYO 65.64 -0.51
0.25 HuanengPower HNP 25.27 -0.07 LATAMAirlines LTM 13.54 -0.08
HUBB 120.16 1.28 L Brands
0.11 Hubbell
LB 42.12 0.61
HUM 241.31 0.88
0.09 Humana
Continued on Page B10
Borrowing Benchmarks | WSJ.com/bonds
Money Rates
October 18, 2017
Key annual interest rates paid to borrow or lend money in U.S. and international markets. Rates below are a
guide to general levels but don’t always represent actual transactions.
Week
Latest ago
Inflation
Sept. index
level
Chg From (%)
Aug. '17 Sept. '16
U.S. consumer price index
0.53
0.19
246.819
252.941
All items
Core
2.2
1.7
International rates
Week
ago
Latest
0.995 1.015 1.300 0.240
1.090 1.085 1.180 0.340
1.240 1.220 1.240 0.470
4 weeks
13 weeks
26 weeks
52-Week
High
Low
0.00
0.50
0.25
1.50
0.00
0.50
0.25
1.50
0.00
0.50
0.25
1.50
0.00
0.50
0.25
1.50
1.09
1.20
One month
Three month
Six month
One year
1.38
0.15
U.S. government rates
One month
Three month
Six month
One year
Other short-term rates
Latest
Week
ago
52-Week
high
low
3.00
1.26
3.00
1.145
1.153
Treasury
MBS
2.25
1.30
-0.376
-0.319
-0.212
-0.071
-0.405
-0.381
-0.317
-0.230
-0.372
-0.329
-0.274
-0.181
Value
Traded
-0.366
-0.311
-0.210
-0.069
-0.375
-0.332
-0.275
-0.183
52-Week
High
Low
51.940 1.366 0.244
89.850 1.506 0.257
Open Implied
Settle Change Interest Rate
0.62
DTCC GCF Repo Index Futures
Libor
One month
Three month
-0.401
-0.376
-0.310
-0.224
DTCC GCF Repo Index
Commercial paper (AA financial)
1.24
-0.373
-0.329
-0.274
-0.183
Latest
Call money
3.00
-0.405
-0.375
-0.317
-0.230
Euro interbank offered rate (Euribor)
30-year mortgage yields
30 days
3.441 3.458 3.865 2.960
60 days
3.463 3.481 3.899 2.990
90 days
Overnight repurchase
U.S.
Euro Libor
Secondary market
4.25 4.25 4.25 3.50
3.20 3.20 3.20 2.70
1.475 1.475 1.475 1.475
—52-WEEK—
High Low
1.55055 1.52933 1.55055 1.24267
1.83456 1.80956 1.83456 1.55622
Six month
One year
Treasury bill auction
Policy Rates
Euro zone
Switzerland
Britain
Australia
Week
Latest ago
Fannie Mae
Prime rates
U.S.
Canada
Japan
—52-WEEK—
High Low
Treasury Oct
Treasury Nov
Treasury Dec
1.23888 1.23889 1.23889 0.52400
1.36261 1.35861 1.36261 0.87567
98.875 unch. 4901 1.125
98.870 -0.005 5490 1.130
98.720 -0.005 1993 1.280
Discount
1.75
1.75
1.00
1.1700
1.3125
1.0500
1.1600
1.1700
1.2000
1.3125
1.1600
1.1700
1.1900
0.3500
0.5625
0.2400
0.3000
0.3200
1.75
Federal funds
Effective rate
High
Low
Bid
Offer
1.1700
1.3125
1.0500
1.1600
1.1700
Notes on data:
U.S. prime rate is the base rate on corporate loans posted by at least 70% of the 10 largest U.S. banks,
and is effective June 15, 2017. Other prime rates aren’t directly comparable; lending practices vary
widely by location; Discount rate is effective June 15, 2017. DTCC GCF Repo Index is Depository
Trust & Clearing Corp.'s weighted average for overnight trades in applicable CUSIPs. Value traded is in
billions of U.S. dollars. Federal-funds rates are Tullett Prebon rates as of 5:30 p.m. ET. Futures on the
DTCC GCF Repo Index are traded on NYSE Liffe US.
Sources: Federal Reserve; Bureau of Labor Statistics; DTCC; SIX Financial Information;
General Electric Capital Corp.; Tullett Prebon Information, Ltd.
Dividend Changes
Dividend announcements from October 18.
Company
Symbol
Amount
Yld % New/Old Frq
Payable /
Record
Increased
Brunswick
Cintas
Healthcare Services Group
Lincoln Electric Holdings
S&T Bancorp
BC
CTAS
HCSG
LECO
STBA
1.3 .19 /.165
1.1 1.62 /1.33
1.5 .19 /.18875
1.6 .39 /.35
2.2 .22 /.20
Q
A
Q
Q
Q
Dec15 /Nov21
Dec08 /Nov10
Dec22 /Nov17
Jan12 /Dec29
Nov16 /Nov02
Initial
Cedar Realty 6.5% Pfd. C
.38819
CDRpC
Nov20 /Nov10
Funds and investment companies
iPath GEMS Asia 8 ETN
iPath GEMS Index ETN
Lazard Div & Income Fd
NA Lazard Global TR Fund
AYT
JEM
LOR
LGI
0.6
4.2
6.3
5.7
Company
Symbol
OSh FTSE AsiaPac Qlty Div
OSh FTSE Eur Quality Div
Voya Gl Equity Div
Voya Intl High Div
Amount
Yld % New/Old Frq
OAPH
OEUH
IGD
IID
1.7
1.8
9.1
8.1
AMX
AMOV
GRP.U
NAP
1.8
1.8
5.1
17.8
MAIN
5.6
.0417
.04148
.061
.052
Payable /
Record
M
M
M
M
Oct24 /Oct19
Oct24 /Oct19
Nov15 /Nov02
Nov15 /Nov02
.15994 SA
.15994 SA
.17395 M
.4225 Q
Nov20 /Oct27
Nov20 /Oct27
Nov15 /Oct31
Nov14 /Nov10
Foreign
America Movil ADR
America Movil Cl A ADR
Granite REIT
Navios Maritime Midstream
Special
.0222
.1039
.06045
.08183
M
M
M
M
Oct23 /Oct19
Oct23 /Oct19
Nov22 /Nov13
Nov22 /Nov13
Main Street Capital
.275
Dec27 /Dec19
KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual;
S2:1: stock split and ratio; SO: spin-off.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
Thursday, October 19, 2017 | B9
COMMODITIES
Futures Contracts
Contract
High hilo
Low
Open
Settle
Coffee (ICE-US)-37,500 lbs.; cents per lb.
Metal & Petroleum Futures
Contract
Open
High hi lo
Low
Settle
Chg
Copper-High (CMX)-25,000 lbs.; $ per lb.
3.1755
3.1840
3.1575
3.1635 –0.0170
Oct
Dec
3.2000
3.2160
3.1710
3.1780 –0.0175
Gold (CMX)-100 troy oz.; $ per troy oz.
1295.10 1295.10
1283.10 1279.90 –3.10
Oct
Dec
1286.90 1290.80
1278.60 1283.00 –3.20
Feb'18
1291.00 1294.30
1282.90 1287.20 –3.20
April
1296.30 1298.10
1288.10 1291.20 –3.20
June
1299.90 1300.70
1291.40 1295.20 –3.20
Dec
1304.80 1307.60
1304.80 1307.50 –3.20
Palladium (NYM) - 50 troy oz.; $ per troy oz.
985.00
985.00 s
985.00
954.05 –23.00
Oct
Dec
977.80
985.75
950.00
952.95 –23.00
March'18 967.85 974.70
943.00
944.40 –20.50
Platinum (NYM)-50 troy oz.; $ per troy oz.
930.00
930.00
930.00
921.90 –10.20
Oct
Jan'18
937.20
938.30
922.50
924.60 –10.20
Silver (CMX)-5,000 troy oz.; $ per troy oz.
17.000
17.010
17.000
16.943 –0.044
Oct
Dec
17.045
17.120
16.920
16.997 –0.044
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl.
51.94
52.33
51.69
52.04
0.16
Nov
Dec
52.17
52.56
51.92
52.26
0.15
Jan'18
52.37
52.72
52.11
52.45
0.17
March
52.61
52.86
52.30
52.64
0.18
June
52.41
52.76
52.21
52.56
0.21
Dec
51.67
52.03
51.49
51.86
0.21
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal.
1.8117
1.8189
1.7896
1.8028 –.0070
Nov
Dec
1.8099
1.8185
1.7903
1.8037 –.0053
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal.
1.6312
1.6553
1.6183
1.6429 .0128
Nov
Dec
1.6134
1.6301
1.6009
1.6190 .0067
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu.
2.923
2.941
2.851
2.854 –.108
Nov
Dec
3.097
3.113
3.059
3.065 –.063
Jan'18
3.220
3.233
3.187
3.194 –.054
Feb
3.228
3.241
3.196
3.203 –.054
March
3.196
3.202
3.158
3.164 –.054
April
2.955
2.960
2.936
2.946 –.024
124.15
128.00
124.70
128.55
123.00
126.85
124.30
128.10
.15 117,946
.10 59,658
March
May
14.08
14.16
14.22
14.31
14.02
14.12
14.08
14.17
.05 428,453
.02 126,506
March
27.00
27.00
27.00
26.99
Dec
March'18
67.81
67.44
68.17
67.83
67.54
67.24
67.63
67.33
153.15
153.10
153.30
153.10
149.80
149.80
150.30
150.25
Dec
March'18
Open
interest
Sugar-World (ICE-US)-112,000 lbs.; cents per lb.
1,235
177,165
Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb.
502
405,082
66,075
14,260
12,487
10,786
Cotton (ICE-US)-50,000 lbs.; cents per lb.
…
2,538
–.14 121,276
–.15 73,653
Orange Juice (ICE-US)-15,000 lbs.; cents per lb.
Nov
Jan'18
1
32,062
3,118
Open
interest
Chg
–2.45
–2.50
2,803
4,761
Interest Rate Futures
Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
154-020 154-030
152-250 153-010 –1-01.0 739,404
Dec
March'18 152-000 152-000
151-280 151-270 –1-01.0
145
Treasury Notes (CBT)-$100,000; pts 32nds of 100%
125-135 125-140
125-015 125-045
–9.5 3,026,143
Dec
March'18 124-275 124-275
124-245 124-265
–9.5 10,381
5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100%
117-107 117-110
117-050 117-067
–4.2 2,955,427
Dec
March'18 116-315 116-315
116-315 116-315
–4.5
5,233
2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100%
107-222 107-225
107-210 107-217
–.7 1,735,962
Dec
March'18 107-162 107-162
107-162 107-162
–1.0
1,859
30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg.
98.845
98.845
98.845
98.845
… 233,096
Oct
Jan'18
98.640
98.645
t 98.630
98.645
… 352,314
10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100%
Dec
101.234 101.234
101.047 101.172 –.328 29,391
1 Month Libor (CME)-$3,000,000; pts of 100%
...
...
... 98.7550 –.0025
828
Nov
Eurodollar (CME)-$1,000,000; pts of 100%
98.5800 98.5850
98.5750 98.5825 .0025 99,693
Nov
Dec
98.4900 98.4950
98.4800 98.4900
… 1,915,233
March'18 98.3500 98.3550
98.3350 98.3500
… 1,328,523
Dec
98.0600 98.0650
98.0300 98.0550 –.0050 1,658,177
11
69,013
267
144,743
101,293
572,028
291,553
239,682
197,069
257,172
69,432
109,122
73,421
133,916
139,206
226,628
196,562
77,740
170,488
122,775
Currency Futures
Nov
Dec
.8926
.8935
.8926
.8941
.8856
.8868
.8868 –.0057
2,951
.8881 –.0057 247,320
Nov
Dec
.7990
.7989
.8025
.8030
.7981
.7982
.8025
.8027
.0051
424
.0050 171,179
Nov
Dec
1.3199
1.3216
1.3214
1.3241
1.3155
1.3163
1.3212
1.3224
.0010
847
.0010 181,969
Dec
March'18
1.0262
1.0310
1.0270
1.0363
1.0204
1.0307
1.0236 –.0028
1.0306 –.0029
.7849
.7840
.7844
.7834
.7834
.7870
.7855
.7852
.7850
.7847
.7843
.7870
.7818
.7814
.7813
.7811
.7809
.7865
Canadian Dollar (CME)-CAD 100,000; $ per CAD
Corn (CBT)-5,000 bu.; cents per bu.
350.25
350.50
347.75
348.50 –1.50 777,081
Dec
March'18 363.75 364.00
361.50
362.25 –1.50 295,269
Oats (CBT)-5,000 bu.; cents per bu.
267.75
268.75
264.00
267.75
3.00
4,815
Dec
March'18 268.50 271.75
266.25
270.25
3.75
1,605
Soybeans (CBT)-5,000 bu.; cents per bu.
984.75
988.50
981.75
984.25
–.50 244,546
Nov
Jan'18
995.25
999.25
992.25
995.00
–.25 230,034
Soybean Meal (CBT)-100 tons; $ per ton.
321.60
322.90
320.30
321.80
.20 149,116
Dec
Jan'18
323.90
325.10
322.60
324.10
.20 86,439
Soybean Oil (CBT)-60,000 lbs.; cents per lb.
33.59
33.68
33.30
33.41
–.18 170,298
Dec
Jan'18
33.75
33.84
33.46
33.57
–.17 99,645
Rough Rice (CBT)-2,000 cwt.; $ per cwt.
1213.00 1216.00
1184.50 1194.50 –18.50
5,032
Nov
Jan'18
1243.50 1245.50
1215.00 1224.50 –18.00
4,630
Wheat (CBT)-5,000 bu.; cents per bu.
434.75
435.25
429.00
430.00 –4.75 256,065
Dec
March'18 453.75 454.00
448.25
449.25 –4.50 101,656
Wheat (KC)-5,000 bu.; cents per bu.
433.00
433.50
427.00
428.00 –5.25 141,055
Dec
March'18 451.00 451.50
445.25
446.25 –5.00 82,827
Wheat (MPLS)-5,000 bu.; cents per bu.
610.00
613.00
608.00
610.00 –1.00 36,212
Dec
March'18 625.00 627.25
622.00
624.25 –1.00 24,492
Cattle-Feeder (CME)-50,000 lbs.; cents per lb.
152.150 153.150
151.200 152.525
.375
4,715
Oct
Jan'18
150.000 150.575
148.675 150.125 –.275 20,496
Cattle-Live (CME)-40,000 lbs.; cents per lb.
110.975 112.075
109.625 111.475
.300
7,790
Oct
Dec
115.750 117.075
114.525 116.650
.675 146,940
Hogs-Lean (CME)-40,000 lbs.; cents per lb.
62.300
63.800
62.300
63.750 1.575 117,789
Dec
Feb'18
67.350
68.075
67.250
68.000
.850 46,816
Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft.
425.00
425.70
420.40
423.70 –4.80
3,623
Nov
Jan'18
412.50
413.20
407.40
412.10 –4.20
2,777
Milk (CME)-200,000 lbs., cents per lb.
16.80
16.82
16.66
16.80
…
3,844
Oct
Nov
16.44
16.44
16.23
16.34
.03
4,543
Cocoa (ICE-US)-10 metric tons; $ per ton.
2,066
2,087
2,057
2,067
3 102,962
Dec
March'18
2,080
2,093
2,064
2,074
–1 88,416
British Pound (CME)-£62,500; $ per £
Swiss Franc (CME)-CHF 125,000; $ per CHF
Australian Dollar (CME)-AUD 100,000; $ per AUD
Nov
Dec
Jan'18
Feb
March
June
.7846
.7842
.7841
.7838
.7836
.7832
.0002
611
.0002 131,956
.0002
277
.0002
297
.0002
699
.0002
242
Mexican Peso (CME)-MXN 500,000; $ per MXN
Dec
.05267
.05285
March'18 .05158 .05208
Euro (CME)-€125,000; $ per €
1.1782
1.1820
Nov
Dec
1.1804
1.1843
54,961
168
.05226
.05157
.05259 .00050 188,234
.05184 .00049
583
1.1745
1.1767
1.1819
1.1841
.0031
6,285
.0032 430,712
Mini DJ Industrial Average (CBT)-$5 x index
Dec
March'18
22964
22950
23124 s
23112 s
22961
22950
23114
23100
2557.60
2561.90 s
2556.60
2560.10
S&P 500 Index (CME)-$250 x index
Dec
Mini S&P 500 (CME)-$50 x index
2556.50 2562.25 s
2556.25 2560.00
Dec
March'18 2557.50 2562.50 s 2557.00 2560.50
Mini S&P Midcap 400 (CME)-$100 x index
Dec
1816.30 1825.90
1816.30 1821.60
Mini Nasdaq 100 (CME)-$20 x index
Dec
6122.3
6132.8 s
6108.0
6119.3
March'18 6135.0 6144.8 s
6121.0
6131.5
Mini Russell 2000 (ICE-US)-$100 x index
1500.70 1510.20
1499.70 1506.40
Dec
Mini Russell 1000 (ICE-US)-$100 x index
1420.00 1420.20 s
1418.50 1419.80
Dec
U.S. Dollar Index (ICE-US)-$1,000 x index
93.34
93.66
93.22
93.23
Dec
March'18
93.08
93.31
92.93
92.94
AlerianMLPETF
CnsmrDiscSelSector
CnsStapleSelSector
DBGoldDoubleLgETN
DBGoldDoubleShrt
EnSelectSectorSPDR
FinSelSectorSPDR
GuggS&P500EW
HealthCareSelSect
IndSelSectorSPDR
iShIntermCredBd
iSh1-3YCreditBond
iSh3-7YTreasuryBd
iShCoreMSCIEAFEETF
iShCoreMSCIEmgMk
iShCoreMSCITotInt
iShCoreS&P500ETF
iShCoreS&PMdCp
iShCoreS&PSmCpETF
iShS&PTotlUSStkMkt
iShCoreUSAggBd
iShSelectDividend
iShEdgeMSCIMinEAFE
iShEdgeMSCIMinUSA
iShGoldTr
iShiBoxx$InvGrCpBd
iShiBoxx$HYCpBd
iShJPMUSDEmgBd
iShMBSETF
iShMSCIACWIETF
iShMSCIBrazilCap
AMLP
XLY
XLP
DGP
DZZ
XLE
XLF
RSP
XLV
XLI
CIU
CSJ
IEI
IEFA
IEMG
IXUS
IVV
IJH
IJR
ITOT
AGG
DVY
EFAV
USMV
IAU
LQD
HYG
EMB
MBB
ACWI
EWZ
10.84
91.14
54.32
24.61
5.56
67.85
26.31
96.64
83.28
71.98
110.01
105.23
123.19
65.16
55.96
62.22
257.43
181.69
74.78
58.62
109.54
94.90
72.09
51.12
12.31
121.21
88.60
116.29
106.91
70.11
42.70
–1.54 –14.0
–0.27 12.0
5.0
–0.13
–2.88 22.3
0.71 –18.9
–0.70 –9.9
0.53 13.2
0.08 11.5
0.14 20.8
0.04 15.7
1.7
–0.04
0.3
0.01
0.6
–0.12
0.28 21.5
0.18 31.8
0.26 23.2
0.09 14.4
9.9
0.34
8.8
0.66
0.10 14.3
1.4
–0.15
7.1
–0.03
0.10 17.8
0.04 13.0
–0.40 11.1
3.4
–0.15
2.4
0.10
5.5
0.02
0.5
–0.21
0.16 18.5
0.14 28.1
SchwabUS LC
SPDR DJIA Tr
SPDR S&PMdCpTr
SPDR S&P 500
SPDR S&P Div
TechSelectSector
UtilitiesSelSector
VanEckGoldMiner
VangdInfoTech
VangdSC Val
VangdDivApp
VangdFTSEDevMk
VangdFTSE EM
VangdFTSE Europe
VangdFTSEAWxUS
VangdGrowth
VangdHlthCr
VangdHiDiv
VangdIntermBd
VangdIntrCorpBd
VangdLC
VangdMC
VangdMC Val
VangdREIT
VangdS&P500
VangdST Bond
VangdSTCpBd
VangdSC
VangdTotalBd
VangdTotIntlBd
VangdTotIntlStk
VangdTotalStk
VangdTotlWrld
VangdValue
WisdTrEuropeHdg
WisdTrJapanHdg
EFA
SCZ
EEM
EZU
EWJ
IBB
MUB
IWF
IWB
IWD
IWO
IWM
IWN
IWV
IWR
IWS
IJK
IVW
IVE
PFF
TIP
SHY
IEF
TLT
IWP
MINT
QQQ
SPLV
BKLN
JNK
GLD
SCHF
SCHB
69.54
62.69
46.50
43.67
57.52
335.97
111.22
128.13
142.35
119.82
180.73
149.52
125.13
151.80
200.07
85.75
206.50
146.73
109.07
38.45
113.52
84.29
106.37
125.09
115.63
101.78
148.86
46.54
23.25
37.27
121.67
34.02
61.92
0.29
0.19
0.24
0.48
–0.10
–0.64
–0.05
0.09
0.08
0.08
0.50
0.48
0.51
0.13
0.08
0.03
0.38
0.06
0.11
–0.08
–0.12
–0.04
–0.25
–0.66
0.12
–0.01
–0.12
–0.02
0.04
0.05
–0.38
0.21
0.11
20.5
25.8
32.8
26.2
17.7
26.6
2.8
22.1
14.4
7.0
17.4
10.9
5.2
14.2
11.9
6.6
13.3
20.5
7.6
3.3
0.3
–0.2
1.5
5.0
18.7
0.4
25.6
11.9
–0.5
2.2
11.0
22.9
14.3
5-year
avg
1,293
1,199
9,716
...
Current
SCHX
DIA
MDY
SPY
SDY
XLK
XLU
GDX
VGT
VBR
VIG
VEA
VWO
VGK
VEU
VUG
VHT
VYM
BIV
VCIT
VV
VO
VOE
VNQ
VOO
BSV
VCSH
VB
BND
BNDX
VXUS
VTI
VT
VTV
HEDJ
DXJ
1.911 1.674 2.618
716.78
3.440 3.220 3.870
2.317 2.114 3.047
395.74
6.6
22-plus year
2.814 2.567 3.622
3.00 3,049,820
3.25 30,229
5.50
92,411
–4.5 277,269
–4.8
1,127
7.40
64,383
2.30
293
–.12
–.12
44,248
1,838
61.11
231.46
331.27
255.72
93.26
60.87
54.25
23.33
157.41
129.00
96.20
44.09
44.96
58.73
53.75
135.21
154.82
82.61
84.58
88.01
117.45
149.02
106.92
84.38
234.87
79.68
80.00
142.93
81.85
54.75
55.92
131.68
72.04
101.51
65.52
56.41
0.11
0.70
0.31
0.10
0.29
0.25
–0.18
–0.38
0.34
0.30
0.11
0.18
0.09
0.51
0.17
–0.07
0.14
0.16
–0.21
–0.17
0.08
0.07
0.12
–0.11
0.09
–0.05
–0.01
0.27
–0.16
–0.07
0.25
0.13
0.07
0.26
0.32
0.45
14.7
17.2
9.8
14.4
9.0
25.9
11.7
11.5
29.6
6.6
12.9
20.7
25.7
22.5
21.7
21.3
22.1
9.0
1.8
2.7
14.7
13.2
10.0
2.2
14.4
0.3
0.8
10.8
1.3
0.8
21.9
14.2
18.1
9.1
14.1
13.9
Expected Previous
change
week
Year
ago
4-week
avg
5-year
avg
9,801 9,127
9,908
9,243
7,617 6,907
860 871
59 105
0
0
59 105
800 766
7,435
863
71
0
71
792
7,306
640
54
0
54
587
...
...
41,602
134,487
11,635
122,852
34,560
294,299
...
-1,500
...
...
...
...
43
134
11
123
36
296
44
156
14
142
39
283
42
135
11
124
36
296
41
131
18
113
37
259
72
107
0
107
262
956
...
...
...
...
...
...
89
85
23
62
100
921
228
32
2
30
182
763
183
87
17
70
162
1,053
104
78
19
60
195
786
Net crude, petroleum
products, incl. SPR
1,955,775
...
1,965 2,036
1,966
1,893
2,870
...
3,856 5,181
3,434
5,448
Natural gas storage
...
...
...
...
...
1,792
3,648
355
931
3,509
1,654
3,987
325
1,305
3,647
1,674
3,720
399
998
3,783
1,569
4,010
261
...
...
Billions of cubic feet; weekly totals
4250
Natural gas,
lower 48 states
t
3250
2250
t
1,641
3,477
531
935
3,421
Fannie mae (FNMA) 2.820 2.220 3.120
2.800 2.170 3.120
12-22 year
...
jet fuel
Distillates
Residual fuel oil
Propane/propylene
Other oils
Ginnie Mae (GNMA) 2.750 2.060 3.090
6.4
...
9,045
Mortgage-Backed
1.8
410.62
...
9,345
2.3
1953.19
2.620 2.230 2.870
...
8,798
2.580 2.050 2.790
U.S. Corporate Indexes Bloomberg Barclays
1985.68
567.12
53,373
4
9,480
3.2 U.S. Aggregate
3.20
3
...
Yield (%)
Latest Low High
Index
Mortgage-Backed Bloomberg Barclays
Broad Market Bloomberg Barclays
1939.45
YTD total
return (%)
1.881 1.677 2.516
4
9,136
Index
Total
return
close
7-12 year
4
motor gasoline
Kerosene-type
Yield (%)
Latest Low High
5.4
...
Finished
YTD total
return (%)
366.13
3,595
19,918 19,858
Total
return
close
4.1 Double-A-rated
...
...
...
...
...
...
5-year
avg
Return on investment and spreads over Treasurys and/or yields paid to investors compared with 52-week
highs and lows for different types of bonds
163 156,448
163
1,384
7,483
690
90
0
90
600
4-week
avg
Bonds | WSJ.com/bonds
Tracking Bond Benchmarks
Muni Master
417
212
35
0
35
177
Weekly Demand, 000s barrels per day
KEY TO CODES: A=ask; B=bid; BP=country elevator bids to producers; C=corrected; E=Manfra,Tordella & Brooks; G=ICE; H=Hurley Brokerage; I=Natural Gas Intelligence;
L=livericeindex.com; M=midday; N=nominal; n.a.=not quoted or not available; R=SNL Energy; S=Platts-TSI; T=Cotlook Limited; U=USDA; W=weekly, Z=not quoted. *Data
as of 10/17
Source: WSJ Market Data Group
4.9
Imports, 000s barrels per day
1,293 1,340
19,716
35.5400
0.2600
n.a.
0.3204
0.2600
0.3200
523.31
464
220
22
0
22
198
19,716
16.9600
20.3520
17.0050
21.2560
£12.8600
Fats and Oils
Corn oil,crude wet/dry mill-u,w
Grease,choice white,Chicago-h
Lard,Chicago-u
Soybean oil,crude;Centl IL-u
Tallow,bleach;Chicago-h
Tallow,edible,Chicago-u
4.150 4.110 4.710
469
228
26
0
26
202
...
n.a.
74
3.1350
80.8
467.8
228
86
228
3.0025
375.00
24.00
7.7863
9.1 Long term
462
221
21
0
21
200
19,142
Grains and Feeds
Barley,top-quality Mnpls-u
Bran,wheat middlings, KC-u
Corn,No. 2 yellow,Cent IL-bp,u
Corn gluten feed,Midwest-u,w
Corn gluten meal,Midwest-u,w
Cottonseed meal-u,w
Hominy feed,Cent IL-u,w
Meat-bonemeal,50% pro Mnpls-u,w
Oats,No.2 milling,Mnpls-u
Rice, 5% Broken White, Thailand-l,w
Rice, Long Grain Milled, No. 2 AR-u,w
Sorghum,(Milo) No.2 Gulf-u
Silver, troy oz.
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA spot price
0.6150
0.6763
*77.70
61.000
n.a.
3834.66
-3,200
...
600
...
...
...
Current
1282.83
1379.04
1280.20
1421.02
*1289.70
*1284.75
1333.07
1345.89
1345.89
1553.47
1259.42
1345.89
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA Gold Price AM
LBMA Gold Price PM
Krugerrand,wholesale-e
Maple Leaf-e
American Eagle-e
Mexican peso-e
Austria crown-e
Austria phil-e
2.5
456,485
222,334
23,816
49
23,767
198,518
Total petroleum
product
Burlap,10-oz,40-inch NY yd-n,w
Cotton,1 1/16 std lw-mdMphs-u
Cotlook 'A' Index-t
Hides,hvy native steers piece fob-u
Wool,64s,staple,Terr del-u,w
175.25
165.92
0.8444
2.3950
168.00
172.00
76.75
2359
1.2327
1.4229
1.0550
15.05
0.67
62.40
1.0561
0.8574
n.a.
162.00
5.5
2776.33
U.S. Corporate
6.1
Triple-B-rated
High Yield Bonds Merrill Lynch
7.5
417.59
High Yield Constrained 5.426 5.399 6.858
8.7 Triple-C-rated
417.92
Freddie Mac (FHLMC) 2.830 2.230 3.130
Global Government J.P. Morgan†
10.288 9.584 13.189
542.35
1.0
Global Government 1.450 1.010 1.560
-0.3
2866.31
6.8
High Yield 100
5.124 4.948 6.448
751.38
Canada
2.100 1.370 2.190
379.13
7.7
Global High Yield Constrained 4.965 4.965 6.450
369.95
0.3
EMU§
1.120 0.673 1.363
Europe High Yield Constrained 2.124 2.124 3.814
710.05
0.5
France
0.850 0.400 1.210
Germany
0.450 0.050 0.620
6.7
306.24
509.29
-1.0
1638.88
2.1
U.S Agency
1.960 1.320 1.960
287.25
-0.3
Japan
0.430 0.170 0.460
1466.01
1.3
10-20 years
1.800 1.140 1.800
561.86
-0.8
Netherlands
0.580 0.160 0.760
3352.29
7.2
20-plus years
2.940 2.630 3.460
916.75
U.K.
1.610 1.340 1.790
2.800 2.410 3.090
806.81
U.S Agency Bloomberg Barclays
4.7 Yankee
0.4
9.2 Emerging Markets ** 5.401 5.279 6.290
** EMBI Global Index
† In local currency § Euro-zone bonds
Sources: Merrill Lynch; Bloomberg Barclays; J.P.Morgan
Global Government Bonds: Mapping Yields
Yields and spreads over or under U.S. Treasurys on benchmark two-year and 10-year government bonds in
selected other countries; arrows indicate whether the yield rose(s) or fell (t) in the latest session
Country/
Coupon (%) Maturity, in years
1.375
2.250
Yield (%)
Latest(l) 0 20 40 60 80 100 120 Previous
Month ago
Year ago
Spread Under/Over U.S. Treasurys, in basis points
Latest
Prev
Year ago
U.S. 2 1.563 s
10 2.340 s
l
l
1.542
2.300
1.397
2.231
0.803
1.737
1.904 t
2.735 t
l
1.921
1.990
1.738
34.1
37.9
93.5
l
2.773
2.807
2.341
39.5
47.3
60.4
France 2 -0.505 s
10 0.681 s
l
-0.530
-0.470
-142.2
0.622
0.731
-0.620 -206.8
0.322
-165.8
-207.2
l
-167.8
-141.5
Germany 2 -0.723 s
10 0.401 s
l
-0.727
-0.688
-226.9
-147.1
l
0.367
0.455
-0.668 -228.6
0.038 -193.9
-193.3
-169.9
l
-0.151
-0.090
-0.092
-170.3
-169.3
-89.4
2.050
Italy 2 -0.140 s
10 2.044 s
l
2.003
2.069
1.386
-29.5
-29.8
-35.1
0.100
Japan 2 -0.131 s
l
-0.135
-0.136
-0.272
-107.5
l
0.070
0.040
-169.4
-0.050 -226.9
-167.7
-223.0
-178.7
Spain 2 -0.285 s
10 1.607 s
l
-0.306
-0.312
-0.221
-184.8
-184.9
-102.3
l
1.547
1.580
1.099
-73.2
-75.4
-63.8
0.441 s
1.315 s
l
0.411
0.424
0.207
-112.2
-113.1
-59.6
l
1.279
1.304
0.982
-102.4
-102.1
-75.6
2.750
Australia 2
2.750
10
0.000
2.750
0.000
0.500
0.050
10
0.100
2.750
1.450
1.750
U.K. 2
4.250
10
0.070
Source: Tullett Prebon
4-week
avg
Year
ago
Fibers and Textiles
Gold, per troy oz
*Constrained indexes limit individual issuer concentrations to 2%; the High Yield 100 are the 100 largest bonds
Year
ago
Expected Previous
change
week
Metals
Food
Beef,carcass equiv. index
choice 1-3,600-900 lbs.-u
select 1-3,600-900 lbs.-u
Broilers, National comp wghtd-u,w
Butter,AA Chicago
Cheddar cheese,bbl,Chicago
Cheddar cheese,blk,Chicago
Milk,Nonfat dry,Chicago lb.
Cocoa,Ivory Coast-w
Coffee,Brazilian,Comp
Coffee,Colombian, NY
Eggs,large white,Chicago-u
Flour,hard winter KC
Hams,17-20 lbs,Mid-US fob-u
Hogs,Iowa-So. Minnesota-u
Pork bellies,12-14 lb MidUS-u
Pork loins,13-19 lb MidUS-u
Steers,Tex.-Okla. Choice-u
Steers,feeder,Okla. City-u,w
2.4
...
Natural gas (bcf)
LBMA Platinum Price PM
*928.0
Platinum,Engelhard industrial
925.0
Platinum,Engelhard fabricated
1025.0
Palladium,Engelhard industrial
978.0
Palladium,Engelhard fabricated
1078.0
Aluminum, LME, $ per metric ton
*2111.0
Copper,Comex spot
3.1635
Iron Ore, 62% Fe CFR China-s
n.a.
Shredded Scrap, US Midwest-s,w
286
Steel, HRC USA, FOB Midwest Mill-s
n.a.
1793.38
1,284,084
Kerosene-type
jet fuel
Distillates
Heating oil
Diesel
Residual fuel oil
Other oils
Other metals
323.30
9.4250
7.4750
4.1750
3.6000
5.3250
1164.38
Closing Chg YTD
Symbol Price (%) (%)
ETF
Inventories, 000s barrels
Crude oil and
petroleum prod
Crude oil
excluding SPR
Gasoline
Finished gasoline
Reformulated
Conventional
Blend. components
SoybeanMeal,Cent IL,rail,ton48%-u
Soybeans,No.1 yllw IL-bp,u
Wheat,Spring14%-pro Mnpls-u
Wheat,No.2 soft red,St.Louis-bp,u
Wheat - Hard - KC (USDA) $ per bu-u
Wheat,No.1soft white,Portld,OR-u
2.690 2.300 3.010
Inventories, imports and demand for the week ended October 13. Current figures are in thousands of barrels or
thousands of gallons per day, except natural-gas figures, which are in billions of cubic feet. Natural-gas import
and demand data are available monthly only.
Expected Previous
change
week
0.9153
1.0510
2.810
2.790
2.790
2.480
2.570
0.810
2.720
55.500
11.750
Wednesday
16.9500
12844
3.160 2.870 3.520
Macro & Market Economics
Watching the Gauges: U.S. Supply and Demand
Current
Wednesday
(U.S.$ equivalent)
Coins,wholesale $1,000 face-a
Propane,tet,Mont Belvieu-g
Butane,normal,Mont Belvieu-g
NaturalGas,HenryHub-i
NaturalGas,TranscoZone3-i
NaturalGas,TranscoZone6NY-i
NaturalGas,PanhandleEast-i
NaturalGas,Opal-i
NaturalGas,MarcellusNE PA-i
NaturalGas,HaynesvilleN.LA-i
Coal,C.Aplc.,12500Btu,1.2SO2-r,w
Coal,PwdrRvrBsn,8800Btu,0.8SO2-r,w
2455.45
Closing Chg YTD
Symbol Price (%) (%)
iShMSCI EAFE
iShMSCIEAFESC
iShMSCIEmgMarkets
iShMSCIEurozoneETF
iShMSCIJapanETF
iShNasdaqBiotech
iShNatlMuniBdETF
iShRussell1000Gwth
iShRussell1000ETF
iShRussell1000Val
iShRussell2000Gwth
iShRussell2000ETF
iShRussell2000Val
iShRussell3000ETF
iShRussellMid-Cap
iShRussellMCValue
iShS&PMC400Growth
iShS&P500Growth
iShS&P500ValueETF
iShUSPfdStk
iShTIPSBondETF
iSh1-3YTreasuryBd
iSh7-10YTreasuryBd
iSh20+YTreasuryBd
iShRussellMCGrowth
PIMCOEnhShMaturity
PwrShQQQ 1
PwrShS&P500LoVol
PwrShSrLoanPtf
SPDRBloomBarcHYBd
SPDR Gold
SchwabIntEquity
SchwabUS BrdMkt
Wednesday
Energy
3.9 Intermediate
Source: SIX Financial Information
Largest 100 exchange-traded funds, latest session
ETF
Wednesday, October 18, 2017
These prices reflect buying and selling of a variety of actual or “physical” commodities in the marketplace—
separate from the futures price on an exchange, which reflects what the commodity might be worth in future
months.
2621.02
Index Futures
Exchange-Traded Portfolios | WSJ.com/ETFresearch
ETF
Cash Prices
Japanese Yen (CME)-¥12,500,000; $ per 100¥
Agriculture Futures
Wednesday, October 18, 2017
Closing Chg YTD
Symbol Price (%) (%)
WSJ.com/commodities
1250
Five-year average
for each week
250
O N D J F M A M J
2016
2017
J A S
Note: Expected changes are provided by Dow Jones Newswires' survey of analysts. Previous and average inventory data are in millions.
Sources: SIX Financial Information via WSJ Market Data Group; U.S. Energy Information Administration; Dow Jones Newswires
Corporate Debt
in that same company’s share price.
Investment-grade spreads that tightened the most…
Spread*, in basis points
One-day change
Issuer
Symbol Coupon (%)
CIT
Nissan Motor Acceptance
Loews
Royal Bank of Scotland
CIT
NSANY
L
RBS
5.800 June 15, ’49
2.600 Sept. 28, ’22
3.750
April 1, ’26
8.625 Aug. 15, ’49
180
42
63
209
General Electric
Lloyds Banking
Pitney Bowes
Viacom
GE
LLOYDS
PBI
VIA
6.375 Nov. 15, ’67
7.500 June 27, ’49
4.625 March 15, ’24
6.250 Feb. 28, ’57
–69 –16
217 –14
301 –14
351 –12
Maturity
Current
–27
–24
–23
–18
Last week
Stock Performance
Close ($)
% chg
n.a.
n.a.
79
261
48.99
...
48.69
7.43
–0.08
...
0.06
2.06
n.a.
236
356
337
23.12
...
13.72
33.65
–0.30
...
0.81
–0.88
75
96
n.a.
n.a.
...
…
58.69
21.13
...
…
0.44
0.19
34
41
85
93
73.12
53.41
...
38.58
1.29
0.41
...
–2.06
…And spreads that widened the most
BNZ International Funding Limited
Pacific Gas And Electric
Cabot
Bed Bath & Beyond
BZLNZ
PCG
CBT
BBBY
2.650
5.125
3.700
4.915
Nov. 3, ’22
Nov. 15, ’43
July 15, ’22
Aug. 1, ’34
72
117
90
278
Citibank
Wells Fargo
Credit Agricole S.A.
Williams Partners
C
WFC
ACAFP
WPZ
2.100 June 12, ’20
2.600 July 22, ’20
3.375 Jan. 10, ’22
4.300 March 4, ’24
39
45
84
96
21
10
8
7
7
7
6
6
High-yield issues with the biggest price increases…
Issuer
Symbol
Coupon (%)
Navient
Seagate HDD Cayman
Vistajet Malta Finance
Cengage Learning
NAVI
STX
VSTJET
CNGO
Ascent Resources Utica Holdings
LSC Communications
Northern Oil And Gas
PetSmart
AMENUT 10.000
LSCCOM 8.750
NOG
8.000
PETM
8.875
Maturity
6.125 March 25, ’24
4.875
June 1, ’27
7.750
June 1, ’20
9.500 June 15, ’24
April 1, ’22
Oct. 15, ’23
June 1, ’20
June 1, ’25
Bond Price as % of face value
Current
One-day change
Last week
2.25
2.20
2.13
1.75
101.500
94.375
91.750
n.a.
11.98
…
...
...
–1.80
…
...
...
107.125
n.a.
n.a.
80.750
...
...
0.71
...
...
...
–3.92
...
94.430
n.a.
102.300
94.497
…
4.86
28.56
18.65
…
0.41
–1.18
–1.95
88.500
86.250
77.250
78.625
…
5.98
1.77
11.46
…
–7.00
–3.28
...
103.000
96.950
95.500
90.250
108.500
104.500
63.250
82.000
1.50
1.50
1.50
1.50
Stock Performance
Close ($)
% chg
…And with the biggest price decreases
Seagate HDD Cayman
Ferrellgas Partners
Cheniere Energy Partners
CenturyLink
STX
FGP
CQP
CTL
5.750
Dec. 1, ’34
8.625 June 15, ’20
5.250
Oct. 1, ’25
7.600 Sept. 15, ’39
Noble Holding International
Community Health Systems
Cenveo
Frontier Communications
NE
CYH
CVO
FTR
7.750
7.125
6.000
9.000
Jan. 15, ’24
July 15, ’20
Aug. 1, ’19
Aug. 15, ’31
94.500 –2.33
89.250 –2.19
–1.45
101.500
–1.25
92.500
89.625
87.938
70.750
78.000
–1.13
–1.06
–1.00
–1.00
*Estimated spread over 2-year, 3-year, 5-year, 10-year or 30-year hot-run Treasury; 100 basis points=one percentage pt.; change in spread shown is for Z-spread.
Note: Data are for the most active issue of bonds with maturities of two years or more
Sources: MarketAxess Corporate BondTicker; WSJ Market Data Group
THE WALL STREET JOURNAL.
B10 | Thursday, October 19, 2017
FINANCE & MARKETS
U.S. Bancorp, a bellwether
for regional banks in the U.S.,
said third-quarter profit rose
to a record level, but analysts
raised concerns about future
loan growth.
The bank said that net income increased 4%, to $1.56
billion, or 88 cents a share, up
from $1.5 billion, or 84 cents a
share, in the year-earlier period. Revenue gained 4%, to
$5.61 billion. Per-share earnings were in line with analyst
expectations, while revenue
slightly beat estimates.
U.S. Bancorp’s shares fell
1.1%, to $53.27 on Wednesday,
a day when bank stocks and
the broader stock market rallied.
Like some other banks, U.S.
Bank has benefited as the Federal Reserve has raised interest rates this year, which allows banks to charge more for
loans. The bank’s net interest
income was up 8% from a year
ago.
Chief Financial Officer
Terry Dolan said in an interview that the bank had turned
in a strong quarter, noting
that it was the first time in
nearly three years that the
bank achieved positive operating leverage. But he acknowledged that loan growth was
lower than the bank had previ-
DAVID PAUL MORRIS/BLOOMBERG NEWS
BY CHRISTINA REXRODE
The bank’s third-quarter profit climbed to a record level, but
some analysts say that slowing loan growth is a worry.
ously expected.
After the election of Donald
Trump, bankers and investors
predicted that lending to businesses would take off, but the
growth of such loans has faltered. “I think we went into
the year believing that commercial and corporate lending
would be reasonably strong
and robust,” Mr. Dolan said.
“But Washington always takes
longer than you think it’s going to.”
Lending to businesses has
been a key factor that analysts
are watching this year at regional banks.
At U.S. Bank, the largest re-
gional lender by assets, average loans rose 3% from a year
ago. Consumer loans, including residential mortgage loans
and credit-card loans, also
rose. Commercial loans increased, but commercial mortgages were down.
Some analysts expressed
disappointment in the level of
loan growth, which has slowed
since last year, and executives
said Wednesday that the
growth was lower than what
they would have expected over
the long term. They also said
that businesses’ borrowing
was related to mergers and acquisitions more than core ex-
pansions.
Evercore ISI analyst John
Pancari said U.S. Bank’s earnings represent a broader trend
of regional banks in tight competition with the bigger, universal banks for business customers. Some of U.S. Bank’s
slowing loan growth is from
the bank’s conservative underwriting principles, Mr. Pancari
said. But investors also took
note of the bank’s indications
that loan growth wasn’t going
to pick up much in the fourth
quarter either.
U.S. Bank executives said
that the slower loan growth
was partly due to corporate
customers paying off bank
loans to instead borrow from
the bond market, repeating an
explanation that they and
other banks had given last
month. Executives said some
customers are still waiting for
more clarity on the Trump administration’s tax policy before investing in their businesses.
“Almost every customer we
talk to…is in wait-and-see
mode,” Mr. Dolan said.
The executives also said
they had expected quarterover-quarter loan growth to
stay steady in the fourth period, which was a disappointment to some analysts hoping
for a return to stronger increases.
Investing Firm Tortoise to Be Acquired
BY SARAH KROUSE
A group of private-equity
firms led by Lovell Minnick
Partners LLC reached an
agreement to buy a majority
stake in income-investing specialist Tortoise, the companies said.
Leawood, Kan.-based money
manager Tortoise has about
$20.2 billion in assets and
runs mutual funds, closed-end
funds and master limited partnerships. Under terms of the
deal, four of five Tortoise cofounders plan to sell their
stakes in the company.
The group of private-equity
investors also includes Har-
bourVest Partners LLC and
AlpInvest Partners.
Financial terms of the purchase weren’t disclosed.
Private-equity firms and
traditional asset managers are
increasingly seeking to buy investment firms that specialize
in alternative asset classes
such as infrastructure that are
able to charge higher fees than
managers of traditional stock
and bond funds.
“Our interest is in specialized businesses where active
management has been proven
to outperform as a result of
the complexity of the subsector” in which the firm has expertise, said Bob Belke, a part-
Biggest 1,000 Stocks | WSJ.com/stocks
Continued From Page B8
Net
Stock
Sym Close Chg
LG Display LPL 12.70
LINE
LN 36.67
L3 Tech
LLL 185.80
LabCpAm LH 147.99
LambWeston LW 50.56
LasVegasSands LVS 61.89
Lazard
LAZ 45.99
Lear
LEA 173.05
Leggett&Platt LEG 48.14
Leidos
LDOS 61.40
Lennar A
LEN 56.27
Lennar B
LEN.B 47.39
-0.03
-0.08
-0.30
-1.74
0.34
-0.42
0.39
0.01
0.41
-0.42
0.34
0.40
Stock
Net
Sym Close Chg
LennoxIntl LII 181.82
LeucadiaNatl LUK 25.77
Level3Comms LVLT 52.93
LibertyProperty LPT 41.41
EliLilly
LLY 85.73
LincolnNational LNC 74.55
LionsGate A LGF.A 30.29
LionsGate B LGF.B 29.44
LiveNationEnt LYV 42.60
LloydsBanking LYG 3.60
LockheedMartin LMT 315.57
Loews
L
48.69
Lowe's
LOW 80.75
Stock
Stock
Net
Sym Close Chg
1.63 LyondellBasell LYB 98.26
0.12 M&T Bank MTB 160.62
-0.54 MGM Resorts MGM 30.44
MPLX 34.09
-0.04 MPLX
MSCI 122.59
-0.33 MSCI
Macerich
MAC 57.08
-0.20
MacquarieInfr MIC 71.72
-0.03
Macy's
M
20.15
-0.04 MagellanMid MMP 68.52
1.19 s MagnaIntl MGA 55.05
0.03 Manpower MAN 122.76
-2.70 ManulifeFin MFC 20.77
0.03 MarathonOil MRO 13.77
-0.36 MarathonPetrol MPC 56.75
0.05
-3.52
-0.05
-0.50
0.14
-0.83
-0.55
0.20
-0.56
1.60
2.01
0.07
-0.19
0.24
ner at Lovell Minnick.
The largest part of Tortoise’s
business—about 60%—is in
MLPs or MLP-focused investing
strategies. Such structures are
taxed differently than corporations and provide a stream of
income to investors. The firm
has units focused on fixed income, energy and infrastructure. It also runs a small indexmanufacturing and exchangetraded products business.
“A lot of investors have set
up either real asset or infrastructure buckets” that they
put a portion of their assets
into, said Tortoise Chief Executive and co-founder Kevin
Birzer, who isn’t among the
Net
Sym Close Chg
Markel
MKL 1061.92
Marsh&McLennan MMC 83.55
MartinMarietta MLM 203.35
Masco
MAS 38.66
Mastercard MA 146.19
McCormick MKC 99.14
McCormickVtg MKC.V 98.85
s McDonalds MCD 165.77
McKesson MCK 146.21
Medtronic MDT 78.59
Merck
MRK 63.51
MetLife
MET 52.80
MettlerToledo MTD 655.66
MichaelKors KORS 49.13
MicroFocus MFGP 32.45
MidAmApt MAA 105.82
Stock
Net
Sym Close Chg
-6.52 MitsubishiUFJ MTU 6.48
0.02 MizuhoFin MFG 3.58
-0.13 MobileTeleSys MBT 10.48
-0.24 s MohawkIndustries MHK 260.00
0.26 MolsonCoors B TAP 82.60
-0.03 Monsanto MON 122.08
MCO 145.20
0.10 s Moody's
0.37 s MorganStanley MS 50.15
MOS 21.16
-0.20 Mosaic
0.59 MotorolaSolutions MSI 89.09
0.29 NRG Energy NRG 25.95
0.42 NTTDoCoMo DCM 23.59
NVR 2900.08
-6.56 NVR
0.14 NationalGrid NGG 62.63
0.28 NatlOilwell NOV 34.52
-1.34 NatlRetailProp NNN 42.37
ADVERTISEMENT
Legal Notices
To advertise: 800-366-3975 or WSJ.com/classifieds
NOTICE OF SALE
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9 A* 0 B:%
(9 " -8--
-0.03
-0.01
-0.06
1.27
-0.10
-0.07
1.07
1.03
0.10
0.21
-0.05
0.08
-2.90
0.53
-0.40
-0.34
founders selling their remaining stakes. “Pipelines fit nicely
into that.”
Tortoise is currently owned
by its employees and managers
and wealth- and asset-management firm Mariner Holdings
LLC. The buyers plan to acquire
two-thirds of the company,
while company insiders plan to
raise their holdings to about a
third of Tortoise from 23%, according to the companies.
Tortoise began exploring a
potential sale of a majority
stake in June, The Wall Street
Journal reported at the time.
The firm’s new owners could
provide capital for deals or to
seed new investment products.
Stock
Net
Sym Close Chg
NewOrientalEduc EDU 91.23
NY CmntyBcp NYCB 12.73
NewellBrands NWL 41.21
NewfieldExpln NFX 29.65
NewmontMining NEM 37.86
NextEraEnergy NEE 152.54
NielsenHoldings NLSN 41.69
Nike
NKE 52.30
NiSource
NI
26.43
NobleEnergy NBL 27.88
Nokia
NOK 5.86
NomuraHoldings NMR 5.80
Nordstrom JWN 42.01
NorfolkSouthern NSC 130.52
NorthropGrumman NOC 292.00
Novartis
NVS 86.04
s NovoNordisk NVO 50.13
Nucor
NUE 57.28
t NuSTAREnergy NS 35.27
OGE Energy OGE 36.87
ONEOK
OKE 55.37
OccidentalPetrol OXY 64.63
Och-Ziff
OZM 3.37
Olin
OLN 34.25
OmegaHealthcare OHI 32.19
Omnicom OMC 75.45
Oracle
ORCL 49.58
Orange
ORAN 16.29
OrbitalATK OA 132.87
Orix
IX
85.82
Oshkosh
OSK 86.87
OwensCorning OC 78.99
PG&E
PCG 56.44
PLDT
PHI 33.25
PNC Fin
PNC 134.74
POSCO
PKX 73.84
PPG Ind
PPG 112.88
PPL
PPL 37.52
PVH
PVH 124.36
PackagingCpAm PKG 116.42
PaloAltoNtwks PANW 149.69
ParkHotels PK 28.74
s ParkerHannifin PH 181.66
ParsleyEnergy PE 26.60
Pearson
PSO 9.01
PembinaPipeline PBA 33.46
Pentair
PNR 70.50
PepsiCo
PEP 111.95
PerkinElmer PKI 70.19
Perrigo
PRGO 88.55
PetroChina PTR 64.92
PetroleoBrasil PBR 10.45
PetroleoBrasilA PBR.A 10.17
Pfizer
PFE 35.83
PhilipMorris PM 112.51
Phillips66 PSX 90.24
PinnacleFoods PF 56.94
PinnacleWest PNW 87.34
PioneerNatRscs PXD 145.09
PlainsAllAmPipe PAA 20.33
PlainsGP
PAGP 21.16
PolarisIndustries PII 105.41
PostHoldings POST 85.45
Potash
POT 19.24
Praxair
PX 139.90
s PrincipalFin PFG 67.90
Procter&Gamble PG 92.77
Progressive PGR 48.09
Prologis
PLD 65.31
PrudentialFin PRU 108.89
Prudential PUK 48.50
PublicServiceEnt PEG 48.66
PublicStorage PSA 214.67
PulteGroup PHM 27.33
QuantaServices PWR 37.40
QuestDiag DGX 92.05
s QuintilesIMS Q
100.93
s RELX
RENX 21.92
RELX
RELX 22.78
RPM
RPM 51.79
RalphLauren RL 85.33
RaymondJames RJF 85.31
Raytheon RTN 187.23
RealtyIncome O
56.29
RedHat
RHT 120.69
RegencyCtrs REG 64.76
RegionsFin RF 14.90
s ReinsuranceGrp RGA 144.54
RepublicServices RSG 63.03
ResMed
RMD 78.87
RestaurantBrands QSR 67.51
RiceEnergy RICE 27.69
RioTinto
RIO 48.02
RobertHalf RHI 50.07
Rockwell
ROK 184.97
RockwellCollins COL 134.61
RogersComm B RCI 53.75
Rollins
ROL 47.66
RoperTech ROP 250.23
s RoyalBkCanada RY 80.29
s RoyalBkScotland RBS 7.43
RoyalCaribbean RCL 124.88
RoyalDutchA RDS.A 60.53
RoyalDutchB RDS.B 62.33
SAP
SAP 111.77
S&P Global SPGI 161.15
0.30
0.01
-0.73
-0.57
-0.49
-0.13
1.69
0.30
-0.02
0.14
0.03
0.01
0.56
1.04
-2.32
-0.30
0.82
0.17
-0.81
-0.05
-1.05
-0.01
0.12
-0.56
0.22
-0.14
0.39
-0.01
-0.41
-0.26
-0.03
-0.41
-1.00
0.25
0.48
0.65
-0.08
0.04
0.20
-0.33
0.27
0.15
0.20
-0.12
0.27
-0.36
0.08
-0.24
-0.22
-0.03
0.18
-0.04
-0.02
-0.37
-0.14
-0.39
-0.08
-0.42
-0.26
-0.48
-0.32
1.47
-0.85
0.08
-1.54
0.33
-0.03
-0.46
1.00
0.10
0.48
0.06
-1.21
0.01
-0.05
-0.13
1.26
0.20
0.15
0.15
-0.68
1.20
-1.42
-0.80
-0.43
-0.30
0.12
1.31
0.04
0.45
0.28
-0.12
-1.77
1.09
-1.30
0.08
-0.23
-0.15
-0.47
0.67
0.15
-2.34
-0.17
0.07
0.43
-0.53
Stock
AIG, United Reach
Insurance Deal
BY LESLIE SCISM
American International
Group Inc. said Wednesday
that it reached an agreement
with United Airlines to offer
travel insurance to the airline’s customers.
The arrangement in part reflects AIG Chief Executive
Brian Duperreault’s plan to
put his stamp on the company
with
expansion
through
growth of existing businesses
and acquisitions.
While AIG is known as one
of the world’s biggest sellers
of property-casualty insurance
to businesses, Mr. Duperreault
has identified the company’s
global Personal Insurance
business as an area in which
opportunities for growth exist,
as well as its life-insurance
and retirement-services business.
Under the multiyear deal,
AIG will offer travel insurance
to United’s customers in the
U.S. and 15 other countries.
The New York-based insurer
has had arrangements with
smaller airline carriers in the
U.S. for years, and some big
ones in Europe, Asia and the
Middle East.
Financial terms weren’t disclosed.
From 2009 through 2012,
AIG divested itself of tens of
billions of dollars of businesses and assets to repay its
nearly $185 billion bailout
during the financial crisis.
More recently, it has been
shrinking the business-insurance unit as a way to shed
poorly performing accounts
and improve margins.
Industrywide, insurers have
been struggling for a few
years to raise rates on many
business-insurance product
lines.
Analysts believe the recent
spate of severe hurricanes will
usher in rate increases for certain product lines, but few are
predicting broad-based increases.
Jeff Rutledge, CEO at AIG
Travel, said the United arrangement springs from technology investments that AIG
made in recent years that
would allow “the use of predictive analytics to enable AIG
to bring robust data insight
directly to the traveler’s insurance offer.”
AIG will provide coverage
for trip cancellation, baggage
loss and emergency medical
services.
The company’s travel insurance business dates from 1939,
when a unit began offering
simple automotive and personal-effects coverage for
tourists and business travelers.
AIG’s Personal Insurance
business includes auto, property and accident insurance.
AIG also is one of the largest
U.S. warranty providers for
consumer electronics and appliances.
TIMOTHY FADEK/BLOOMBERG NEWS
U.S. Bancorp Profit Rises
Under the deal, AIG will offer travel insurance to United Airlines
customers in the U.S. as well as 15 other countries.
Net
Sym Close Chg
SINOPECShanghai SHI 63.47
SK Telecom SKM 26.17
SLGreenRealty SLG 101.54
Salesforce.com CRM 96.44
Sanofi
SNY 49.53
Sasol
SSL 28.97
Scana
SCG 49.13
Schlumberger SLB 65.91
SchwabC
SCHW 43.48
s ScottsMiracleGro SMG 99.62
SealedAir SEE 44.08
SemicondctrMfg SMI 6.44
SempraEnergy SRE 113.05
s SensataTech ST 49.68
ServiceCorp SCI 34.25
ServiceMaster SERV 46.76
s ServiceNow NOW 120.77
ShawComm B SJR 21.98
SherwinWilliams SHW 384.09
ShinhanFin SHG 44.02
Shopify
SHOP 98.93
SimonProperty SPG 164.49
SmithAO
AOS 60.64
Smith&Nephew SNN 38.12
Smucker
SJM 104.14
Snap
SNAP 15.75
SnapOn
SNA 153.52
SOQUIMICH SQM 60.60
Sony
SNE 37.46
Southern
SO 51.27
SoCopper SCCO 43.43
SouthwestAirlines LUV 58.83
SpectraEnerPtrs SEP 43.49
SpectrumBrands SPB 110.50
SpiritAeroSys SPR 79.48
Sprint
S
7.05
Square
SQ 32.52
StanleyBlackDck SWK 156.85
StarwoodProp STWD 21.80
StateStreet STT 98.35
Statoil
STO 20.17
Steris
STE 90.50
STMicroelec STM 19.87
s Stryker
SYK 148.64
SumitomoMits SMFG 7.87
SunCommunities SUI 88.90
SunLifeFinancial SLF 39.76
SuncorEnergy SU 33.76
SunTrustBanks STI 59.29
SynchronyFin SYF 31.51
Syngenta SYT 92.04
Sysco
SYY 54.87
TAL Education TAL 35.24
TE Connectivity TEL 87.52
Telus
TU 36.13
Ternium
TX 31.23
TIM Part
TSU 19.22
TJX
TJX 71.30
s TableauSoftware DATA 78.67
s TaiwanSemi TSM 41.50
TargaResources TRGP 44.46
Target
TGT 60.03
TataMotors TTM 32.86
TechnipFMC FTI 25.49
TeckRscsB TECK 22.16
s TelecomArgentina TEO 31.69
TelecomItalia TI
9.04
TelecomItalia A TI.A 7.25
TeledyneTech TDY 163.06
Teleflex
TFX 240.64
TelefonicaBras VIV 16.11
Telefonica TEF 10.52
TelekmIndonesia TLK 31.38
Tenaris
TS 26.49
s Teradyne
TER 39.28
TevaPharm TEVA 14.62
Textron
TXT 53.57
ThermoFisherSci TMO 189.22
ThomsonReuters TRI 47.59
ThorIndustries THO 130.70
3M
MMM 218.27
Tiffany
TIF 94.42
TimeWarner TWX 101.48
s Toll Bros
TOL 43.11
s Torchmark TMK 82.16
Toro
TTC 62.16
TorontoDomBk TD 57.33
Total
TOT 54.03
TotalSystem TSS 67.16
s ToyotaMotor TM 124.26
TransCanada TRP 49.69
TransDigm TDG 265.70
s TransUnion TRU 50.56
Travelers
TRV 130.02
TurkcellIletism TKC 9.55
TurquoiseHill TRQ 3.29
Twitter
TWTR 18.02
TylerTech TYL 176.16
TysonFoods TSN 71.55
UBS Group UBS 17.26
UDR
UDR 38.55
UGI
UGI 47.96
US Foods USFD 27.14
UltraparPart UGP 24.86
UnderArmour A UAA 16.33
UnderArmour C UA 14.98
Unilever
UN 61.39
1.20
...
-0.47
-0.28
-0.06
-0.16
...
-0.59
0.09
0.47
-0.19
-0.06
-0.99
0.52
-0.09
0.35
-1.98
-0.13
1.41
0.42
2.72
-2.61
-0.08
0.03
-0.51
-0.34
1.27
0.64
0.51
0.13
-0.05
0.10
-0.48
-0.38
0.41
-0.04
-0.17
0.21
0.05
1.20
-0.23
-0.29
-0.20
-0.15
0.05
-0.10
0.29
0.02
0.12
0.53
0.03
0.04
0.17
-0.21
0.10
0.44
0.14
-0.50
-0.35
0.25
-0.92
-0.14
0.04
-0.55
-0.32
0.24
0.01
0.06
1.53
-0.12
0.06
0.01
-0.92
-0.45
0.21
-0.12
0.50
0.45
-0.47
0.88
0.52
-0.52
0.02
0.07
0.27
0.21
0.49
0.07
-0.24
0.95
-0.84
-0.30
0.90
1.37
-0.04
-0.06
-0.26
0.54
0.61
0.02
-0.22
0.28
-0.19
-0.03
0.02
-0.13
0.41
Stock
Net
Sym Close Chg
Unilever
UL 59.86
UnionPacific UNP 110.38
UnitedContinental UAL 67.99
UnitedMicro UMC 2.64
UPS B
UPS 118.15
UnitedRentals URI 144.32
US Bancorp USB 53.27
US Steel
X
27.25
UnitedTech UTX 119.18
s UnitedHealth UNH 205.23
UniversalHealthB UHS 108.52
UnumGroup UNM 52.19
VEREIT
VER 8.23
VF
VFC 65.07
Visa
V
107.80
VailResorts MTN 221.80
Vale
VALE 10.15
ValeroEnergy VLO 77.62
Vantiv
VNTV 68.96
VarianMed VAR 104.40
Vedanta
VEDL 20.36
VeevaSystems VEEV 59.38
Ventas
VTR 63.31
Verizon
VZ 48.65
VistraEnergy VST 18.70
s VMware
VMW 116.60
VornadoRealty VNO 77.00
VoyaFinancial VOYA 39.96
VulcanMaterials VMC 116.94
WABCO
WBC149.07
WEC Energy WEC 65.70
W.P.Carey WPC 69.68
Wabtec
WAB 75.50
Wal-Mart WMT 86.22
s WasteConnections WCN 70.51
WasteMgt WM 76.94
Waters
WAT 181.16
Watsco
WSO 160.33
Wayfair
W 67.13
WellCareHealth WCG 176.04
WellsFargo WFC 53.41
Welltower HCN 68.31
WestPharmSvcs WST 92.41
WestarEnergy WR 52.56
WesternGasEquity WGP 39.27
WesternGasPtrs WES 50.01
WesternUnion WU 19.79
WestlakeChem WLK 83.10
WestpacBanking WBK 26.06
WestRock WRK 59.60
Weyerhaeuser WY 35.23
WheatonPrecMetals WPM 20.00
Whirlpool WHR 176.79
Williams
WMB 29.69
WilliamsPartners WPZ 38.58
Wipro
WIT 5.38
WooriBank WF 45.17
Wyndham WYN 109.33
XPO Logistics XPO 64.76
XcelEnergy XEL 48.73
Xerox
XRX 32.84
Xylem
XYL 63.68
YPF
YPF 22.82
YumBrands YUM 76.02
YumChina YUMC 42.46
ZTO Express ZTO 15.41
ZayoGroup ZAYO 35.47
ZimmerBiomet ZBH 120.69
Zoetis
ZTS 65.56
0.37
-0.19
0.48
0.01
0.47
0.98
-0.61
0.62
-0.18
1.34
0.06
0.19
0.01
0.48
0.26
2.81
-0.11
...
-0.06
0.20
-0.04
-0.20
0.11
0.25
-0.31
1.00
-1.28
0.46
-0.07
1.03
0.20
0.40
0.16
0.24
0.33
0.10
0.24
0.49
-0.63
2.01
0.22
0.12
-0.59
-0.01
-0.12
-0.67
0.09
-0.55
-0.05
...
0.20
0.11
0.45
-0.23
-0.81
0.01
-0.39
-0.30
0.12
0.01
0.09
0.45
0.02
-0.17
-0.22
0.45
0.30
0.76
-0.25
NASDAQ
AGNC Invt AGNC 21.81 -0.04
Ansys
ANSS 129.56 -0.13
ASML
ASML171.73 -4.61
Abiomed
ABMD 172.95 0.48
ActivisionBliz ATVI 61.50 -0.16
AdobeSystems ADBE 153.00 2.62
AkamaiTech AKAM 51.00 0.42
AlexionPharm ALXN 140.24 -2.92
AlignTech ALGN 194.23 -0.04
Alkermes ALKS 51.09 -0.39
AlnylamPharm ALNY 117.55 -1.15
s Alphabet A GOOGL 1012.74 1.74
Alphabet C GOOG 992.81 0.63
Altaba
AABA 67.79 1.01
Amazon.com AMZN 997.00-12.13
Amdocs
DOX 65.81 -0.29
Amerco
UHAL 369.42 1.58
AmericanAirlines AAL 52.03 -0.04
Amgen
AMGN 186.28 0.09
AnalogDevices ADI 89.00 0.06
Apple
AAPL 159.76 -0.71
s AppliedMaterials AMAT 55.34 0.21
ArchCapital ACGL 100.30 0.71
Atlassian
TEAM 39.81 0.06
Autodesk ADSK 118.54 -0.18
ADP
ADP 113.93 0.21
BOK Fin
BOKF 89.74 1.07
Baidu
BIDU 268.97 -1.35
BankofOzarks OZRK 45.66 0.52
s Biogen
BIIB 344.58 0.11
BioMarinPharm BMRN 88.62 -4.92
Bioverativ BIVV 59.96 -0.11
bluebirdbio BLUE 139.10 -1.10
BrighthouseFin BHF 60.71 0.08
Broadcom AVGO 244.00 1.38
Stock
Net
Sym Close Chg
CA
CA 33.73
CDK Global CDK 65.29
CDW
CDW 68.65
CH Robinson CHRW 77.34
CME Group CME 136.37
CSX
CSX 53.68
CadenceDesign CDNS 41.79
Carlyle
CG 24.45
CboeGlobalMkts CBOE 109.59
Celgene
CELG 137.17
Cerner
CERN 72.69
CharterComms CHTR 352.07
CheckPointSftw CHKP 118.01
ChinaLodging HTHT 130.05
CincinnatiFin CINF 76.00
Cintas
CTAS 151.16
CiscoSystems CSCO 33.55
CitrixSystems CTXS 82.27
s Cognex
CGNX 121.97
CognizantTech CTSH 73.94
Coherent
COHR 259.88
Comcast A CMCSA 36.20
CommerceBcshrs CBSH 57.05
CommScope COMM 31.80
s Copart
CPRT 36.43
CoStarGroup CSGP 283.75
Costco
COST 157.55
Ctrip.com CTRP 54.27
DISH Network DISH 49.71
DentsplySirona XRAY 59.50
DiamondbackEner FANG 102.19
DiscoveryComm B DISCB 22.50
DiscoveryComm A DISCA 19.63
DiscoveryComm C DISCK 18.53
DollarTree DLTR 91.47
E*TRADE ETFC 43.92
EastWestBancorp EWBC 57.46
eBay
EBAY 37.97
ElbitSystems ESLT 151.19
ElectronicArts EA 113.16
Equinix
EQIX 471.23
Ericsson
ERIC 5.98
Exelixis
EXEL 27.53
Expedia
EXPE 152.28
ExpeditorsIntl EXPD 58.69
t ExpressScripts ESRX 57.77
F5Networks FFIV 116.74
s Facebook
FB 176.03
Fastenal
FAST 48.45
FifthThirdBncp FITB 28.07
Fiserv
FISV 127.07
Flex
FLEX 17.66
FlirSystems FLIR 43.11
Fortinet
FTNT 40.29
Gaming&Leisure GLPI 36.76
Garmin
GRMN 55.08
Gentex
GNTX 20.46
GileadSciences GILD 80.01
Goodyear GT 33.39
Grifols
GRFS 21.50
HD Supply HDS 36.29
Hasbro
HAS 96.72
HenrySchein HSIC 82.29
Hologic
HOLX 36.89
JBHunt
JBHT 104.45
HuntingtonBcshs HBAN 13.95
IAC/InterActive IAC 124.60
IdexxLab
IDXX 163.05
IHSMarkit INFO 43.63
s IPG Photonics IPGP 203.00
IRSA Prop IRCP 61.35
IcahnEnterprises IEP 56.03
Icon
ICLR 114.49
Illumina
ILMN 205.62
Incyte
INCY 115.14
s Intel
INTC 40.25
s InteractiveBrkrs IBKR 49.76
Intuit
INTU 145.77
IntuitiveSurgical ISRG 354.37
s IonisPharma IONS 63.89
JD.com
JD 40.32
JackHenry JKHY 104.16
JazzPharma JAZZ 140.46
JetBlue
JBLU 20.07
KLA Tencor KLAC 108.09
t KraftHeinz KHC 77.10
s LKQ
LKQ 37.54
s LamResearch LRCX200.49
LamarAdvertising LAMR 68.52
LibertyBroadbandA LBRDA 91.98
LibertyBroadbandC LBRDK 93.00
LibertyGlobal A LBTYA 32.40
LibertyGlobal C LBTYK 31.37
LibertyLiLAC A LILA 21.79
LibertyLiLAC C LILAK 22.02
LibertyQVC A QVCA 22.90
LibertyVenturesA LVNTA 57.65
LibertyFormOne A FWONA 38.29
LibertyFormOne C FWONK 40.07
LibertyBraves A BATRA 24.96
LibertyBraves C BATRK 24.86
LibertySirius A LSXMA 43.55
LibertySirius C LSXMK 43.53
LincolnElectric LECO 94.99
LogitechIntl LOGI 36.80
LogMeIn
LOGM 117.35
0.14
0.56
0.11
1.32
0.18
-0.55
-0.02
0.40
0.06
-1.69
0.18
-5.77
1.05
-2.68
0.07
0.11
-0.05
0.28
1.23
-0.03
4.99
-0.27
0.57
0.14
0.04
0.03
-0.83
-0.34
0.86
...
-0.42
...
0.47
0.44
-0.06
0.14
0.37
0.48
-0.25
-2.82
9.65
0.08
-0.77
3.14
0.67
0.56
0.46
-0.08
0.51
0.10
0.44
0.06
0.61
1.03
0.08
-0.12
0.12
-0.23
0.36
-0.01
0.18
0.16
-0.16
0.08
2.02
0.14
-0.55
3.05
-0.13
2.02
0.15
0.18
0.72
-0.86
-0.50
0.46
2.36
0.27
-0.63
0.04
0.73
-0.19
-0.04
-0.11
0.08
-0.44
0.13
5.94
-0.17
-1.00
-0.99
-0.07
-0.14
-0.12
-0.18
-0.02
-0.23
-0.12
-0.05
0.24
0.18
0.14
0.19
0.55
0.08
2.05
Stock
Net
Sym Close Chg
lululemon LULU 59.72
MarketAxess MKTX 193.48
s Marriott
MAR 115.77
MarvellTech MRVL 18.45
MatchGroup MTCH 25.52
s MaximIntProducts MXIM 49.85
MelcoResorts MLCO 23.28
MercadoLibre MELI 242.41
MicrochipTech MCHP 92.12
MicronTech MU 41.65
Microsemi MSCC 51.84
Microsoft MSFT 77.61
Middleby
MIDD 118.61
Momo
MOMO 33.98
Mondelez MDLZ 40.81
MonsterBeverage MNST 56.29
Mylan
MYL 37.51
NXP Semi NXPI 115.36
Nasdaq
NDAQ 74.60
NatlInstruments NATI 44.14
NetApp
NTAP 44.62
Netease
NTES 277.73
Netflix
NFLX 195.54
NewsCorp A NWSA 13.73
NewsCorp B NWS 14.10
Nordson
NDSN 123.37
NorthernTrust NTRS 94.58
NorwegianCruise NCLH 57.47
NVIDIA
NVDA 197.58
OReillyAuto ORLY 212.99
OldDomFreight ODFL 109.65
ON Semi
ON 19.71
OpenText OTEX 33.83
s PTC
PTC 60.64
Paccar
PCAR 72.60
Paychex
PAYX 63.03
PayPal
PYPL 67.26
People'sUtdFin PBCT 18.24
s PilgrimPride PPC 30.57
Priceline
PCLN 1941.87
Qiagen
QGEN 34.40
Qorvo
QRVO 72.02
Qualcomm QCOM 52.21
RandgoldRscs GOLD 97.19
RegenPharm REGN 439.37
RossStores ROST 63.32
RoyalGold RGLD 87.51
Ryanair
RYAAY105.99
SBA Comm SBAC 147.40
SEI Investments SEIC 63.48
Sina
SINA 114.89
SS&C Tech SSNC 41.69
SVB Fin
SIVB 182.70
ScrippsNetworks SNI 83.77
Seagate
STX 34.26
SeattleGenetics SGEN 63.68
Shire
SHPG 146.29
SignatureBank SBNY 124.74
SiriusXM
SIRI 5.75
Skyworks SWKS 107.34
Splunk
SPLK 63.28
Starbucks SBUX 55.21
SteelDynamics STLD 36.44
Stericycle SRCL 71.65
Symantec SYMC 32.15
Synopsys SNPS 83.18
TD Ameritrade AMTD 47.54
TESARO
TSRO 113.60
T-MobileUS TMUS 60.68
s TRowePrice TROW 95.76
TakeTwoSoftware TTWO 104.61
Tesla
TSLA 359.65
TexasInstruments TXN 93.43
TractorSupply TSCO 58.68
Trimble
TRMB 41.03
21stCenturyFoxA FOXA 27.18
21stCenturyFoxB FOX 26.59
UltaBeauty ULTA 198.37
UltimateSoftware ULTI 191.72
UniversalDisplay OLED 137.55
VEON
VEON 4.04
VeriSign
VRSN 109.26
VeriskAnalytics VRSK 84.80
VertxPharm VRTX 154.76
Viacom A VIA 33.65
Viacom B VIAB 25.82
Vodafone VOD 28.98
WPP
WPPGY 92.74
WalgreensBoots WBA 67.74
Weibo
WB 99.27
WesternDigital WDC 85.50
s WillisTwrsWatson WLTW 159.80
Workday
WDAY 107.18
WynnResorts WYNN 145.33
Xilinx
XLNX 72.07
Yandex
YNDX 32.32
s ZebraTech ZBRA 112.76
Zillow A
ZG 40.92
Zillow C
Z
41.02
ZionsBancorp ZION 46.17
0.79
2.09
0.73
0.09
-0.56
-0.01
...
7.62
0.42
1.26
0.56
0.02
-2.19
0.63
-0.32
-0.23
-1.03
0.21
-0.11
-0.07
0.54
-2.12
-3.94
0.11
0.15
0.26
3.48
-1.14
-0.17
0.98
1.70
0.11
0.13
0.38
-0.10
0.13
0.59
0.15
0.93
7.34
0.14
-0.25
-0.20
-0.09
-3.19
0.08
-0.08
-0.38
-1.06
0.16
0.63
0.13
1.06
0.53
0.30
-0.40
-5.76
1.02
0.04
-0.01
-0.69
0.70
0.27
0.38
0.14
-0.54
0.32
-4.93
-0.26
1.03
0.71
3.90
-0.84
-0.42
-0.02
0.30
0.37
-3.91
-1.52
0.60
0.02
0.71
0.49
-0.29
-0.30
-0.75
-0.01
-0.03
0.34
1.09
-0.28
0.86
-0.44
-1.07
-0.30
0.57
1.88
-0.59
-0.60
0.18
NYSE AMER
CheniereEnergy LNG
CheniereEnerPtrs CQP
CheniereEnHldgs CQH
ImperialOil IMO
47.35
28.56
25.54
31.77
-0.59
-0.34
-0.39
-0.13
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THE WALL STREET JOURNAL.
* * * *
Thursday, October 19, 2017 | B11
MARKETS
IBM Puts Dow Atop 23000 at Close Treasury
Yields
Blue-chip index hits
four 1,000-point
milestones in a year
for the first time
BY AMRITH RAMKUMAR
AND RIVA GOLD
The Dow Jones Industrial
Average closed above 23000
for the first time, driven by
soaring shares of International Business Machines.
Wednesday marked the bluechip index’s fourth 1,000-point
milestone in
WEDNESDAY’S this year’s
MARKETS
largely uninterrupted
stock-market rally. The Dow industrials
had never reached more than
two such round-number marks
in a year before 2017. Despite
concerns that stocks are pricey
and U.S. economic growth remains tepid, the blue-chip index is up 17% this year and has
set 51 closing records.
Robust corporate earnings
in the U.S. and abroad have
supported a bull market now
in its ninth year. With all 45
economies tracked by the Organization for Economic Coop-
Stretched Valuations
U.S. stocks have gotten more expensive compared with historic levels.
6
3
Difference between S&P 500's
price/earnings ratio and its 10-year average
0
–3
–6
2010
2011
2012
2013
2014
2015
2016
2017
Note: Based on 12-month trailing P/E and rolling 10-year average. Data are through Oct. 17.
Source: FactSet
THE WALL STREET JOURNAL.
eration and Development on
track to grow this year for the
first time in a decade, many
analysts and investors say
conditions are favorable for
stocks to continue to rise.
“We finally have everything
clicking at once,” said Ryan
Detrick, senior market strategist at LPL Financial. “What
we’ve seen this year is really a
global resurgence,” he said.
The Dow industrials rose
160.16 points, or 0.7%, to
23157.60 in its largest one-day
advance in five weeks. The index closed about three points
shy of 23000 on Tuesday after
briefly climbing above that
level during the day.
IBM’s stock had its best day
since 2009 on Wednesday,
helping propel the Dow decisively over its latest milestone. The company’s shares
rose $12.99, or 8.9%, to
$159.53 after the company on
Tuesday
exceeded
Wall
Street’s profit and sales expectations in the most recent
quarter. Gains in its hardware
and artificial-intelligence divisions encouraged analysts
even though revenue and
earnings declined.
IBM’s gain added 89 points
to the Dow industrials. Even
with that surge, Boeing was
still the biggest contributor to
the 30-member index since its
last 1,000-point milestone.
The S&P 500 climbed 1.90
points, or less than 0.1%, to
2561.26 Wednesday, and the
Nasdaq Composite advanced
0.56 point, or less than 0.1%,
to 6624.22. Both indexes also
closed at records.
Wednesday’s session was relatively quiet, with fewer shares
traded than this year’s daily average. About 5.5 billion shares
changed hands across exchanges owned by the New York
Stock Exchange and the Nasdaq.
The financial sector was
among the best performers,
buoyed by big banks that recently reported strong earnings
despite a slowdown in trading
revenue. Investors’ response to
bank earnings has been mixed.
Morgan Stanley shares
rose 1.03, or 2.1%, to 50.15 and
Goldman Sachs Group advanced 5.94, or 2.5%, to
242.03—adding 41 points to
the Dow—after Goldman
shares fell following its earnings report the previous day.
Northern Trust was among
the S&P 500’s biggest gainers.
Its shares rose 3.48, or 3.8%,
to 94.58 after the firm reported quarterly sales and
profit figures that topped analysts’ projections.
Third-quarter earnings season has gotten off to a strong
start, investors say. Of the S&P
500 companies that have reported so far, more than 80%
have beat expectations, compared with the five-year average
of 69%, according to FactSet.
Expectations for U.S. tax
cuts have also delivered a
boost to Wall Street in recent
sessions, some analysts say.
Vincent Deluard, head of
global macro strategy at INTL
FCStone, said he recommended buying small-cap
value stocks in late August.
Smaller firms that generate
more revenue domestically
stand to benefit from tax cuts
and won’t be affected as much
if interest rates rise, he said.
In early trading Thursday,
key Asian indexes gained, led
by strength in Japan, thanks
to a weaker yen and robust
trade data. The Nikkei Stock
Average was up 0.4%. Elsewhere, Australia’s S&P/ASX
200 was up 0.2%. Korea’s Kospi index was flat.
Banks Aim to Unleash the Robots on Bonds
BY TELIS DEMOS
Big investment banks are
pushing to stoke more fully
automated trading in the $6
trillion market for investmentgrade corporate debt.
Banks including Credit
Suisse Group AG, Goldman
Sachs Group Inc. and Morgan
Stanley have unleashed new
trading software systems in
recent months to pick up
share.
In part because of its complexity and relatively low
transaction volumes, that corner of Wall Street has been
one of the more resistant to
technological changes sweeping trading, lending and just
about everything else in banking. A recent study by the
Bank for International Settlements estimated that only
40% of investment-grade corporate bond trading was executed through computers
rather than over the phone,
compared with 75% in Treasury-debt trading, 80% in
stocks and 90% in a broad array of futures contracts.
The investment banks are
targeting small trades, those
under $1 million, that other-
wise might fall through the
cracks. It is yet another example of banks turning to technology to try to generate revenue growth at relatively low
cost.
Starting with the smaller
trades is a safer route for the
banks because it doesn’t
threaten the profit margins on
the big trades they do with institutions.
While the banks are taking
it slow, the smaller trades
eventually may be a precursor
to fully automating some bigger trades, which are often
trickier to execute and require
more human hand-holding.
“Banks see an opportunity
to take advantage of trading
opportunities they were missing in the past,” said Richard
Schiffman, head of open trading at MarketAxess Holdings
Inc., operator of an electronic
bond-trading network.
Some past efforts to change
the patterns of bond trading
have met resistance or petered
out. Platforms offered several
years ago by Wall Street firms
including Goldman and money
manager BlackRock Inc. were
shelved or integrated into
other efforts.
Small Gets Bigger
Monthly value of U.S.
investment-grade corporate
bond trades under $1 million
$50 billion
45
40
35
30
25
20
2014
2015
2016
2017
Note: Dealer-to-client trades
Source: MarketAxess
THE WALL STREET JOURNAL.
But more recent initiatives,
such as networks connecting
bond investors to trade with
each other, have started to
show traction.
Credit Suisse launched its
system, called CSLiveEx, this
year, making the decision to
fully automate the smallest
trades in the U.S. market for
bonds of corporations with top
credit. That means the trades
have no direct human involvement.
In corporate bonds, traders
working the phone still dominate the market, in part because there are so many various bonds to follow, all with
different permutations such as
maturity and yield. Some corporate bonds also don’t trade
that often after their initial
sale, even for major companies
like Apple Inc. In that type of
market, salespeople who can
influence buyers and sellers
still add value.
“We are running with the
machines, rather than letting
them do the running on their
own,” said Samik Chandarana,
a veteran credit trader who
was recently named head of
analytics and data science at
J.P. Morgan Chase & Co.’s investment bank. J.P. Morgan
and its peers, which tend to
have bigger trading desks,
have invested in technology as
well, primarily to aid human
traders.
While automated service is
more prevalent in trading for
retail bond investors, and has
been technically feasible for
several years, it is rarely used
to respond to electronic trade
requests from institutions
such as pensions and hedge
funds.
But the increasing amounts
and sophistication of data is
starting to change that. And
banks are eager to make
money out of the thousands of
small electronic trade requests
they get daily.
Credit Suisse says its new
technology will help the firm
serve more clients without
adding extra traders or bond
inventory. CSLiveEx is “designed to have as many customers as possible, without
using a lot of balance sheet,”
said Julian Pomfret-Pudelsky,
a fixed-income algorithmic
trader at Credit Suisse who
began working on the project
in early 2016.
Goldman in 2015 began
making a limited number of
trades under $1 million via
software called GS Algo and
has this year expanded that to
some 7,500 different individual
bonds.
Morgan Stanley has also recently begun fully automated
trading for smaller investment-grade corporate bonds,
people familiar with the matter said.
Continue
To Climb
BY AKANE OTANI
U.S. government bond
prices weakened as major
stock indexes climbed to fresh
records.
The yield on the 10-year
Treasury note settled at
2.339% Wednesday, compared
with 2.300% on Tuesday.
Yields rise as
CREDIT
bond prices fall.
MARKETS
Bond yields
have risen in recent weeks as
investors have bet the Federal
Reserve will raise interest
rates once more by year-end.
Analysts also have been
considering the possibility that
at the end of her term Fed
Chairwoman Janet Yellen
could be replaced by someone
with a more hawkish stance on
monetary policy. President
Donald Trump is expected to
make a decision by Nov. 3.
A Fed that unwinds easymoney policies faster than investors anticipate could send
yields higher, analysts said.
Money managers believe a policy misstep from the Fed or
the European Central Bank
ranks as the top risk to the
markets, Bank of America Merrill Lynch found in its October
global fund manager survey.
Still, others say the Fed’s
impact on the bond market
could be limited. The central
bank has clearly telegraphed
its intentions to normalize its
balance sheet and gradually
raise rates, several investors
said, and economic growth has
been solid enough to support
the moves.
“We’ve got a body of work
from this current Fed composition that indicates a certain
monetary policy path, and
while it could certainly be impacted by new introductions to
the voting body, ultimately
they’re going to be driven by
their dual mandate,” said Bill
Northey, chief investment officer for the Private Client
Group of U.S. Bank.
Meanwhile, a consensus
that the Fed will raise rates in
December continued to send
yields on shorter-term debt
higher.
The yield on the two-year
Treasury note, which tends to
be more sensitive to interestrate expectations, settled at
1.563%, near a nine-year high,
compared with 1.550% on
Tuesday.
BY DAVE MICHAELS
WASHINGTON—The Securities and Exchange Commission
tapped J.P. Morgan Chase &
Co.’s top electronic-trading executive as a senior regulator,
signaling an appetite for shaking up rules that are blamed
for fragmenting trading across
dozens of venues and fomenting the rise of high-frequency
trading.
Brett Redfearn will become
the SEC’s director of trading
and markets, making him the
agency’s point person for regulating exchanges, brokerdealers and high-speed trading
firms.
As J.P. Morgan’s global head
of market structure, Mr. Redfearn has criticized some exchanges’ business models and
privileges, including the legal
immunity they enjoy from
many lawsuits.
Mr. Redfearn has particularly needled exchanges over
their practice of packaging
and selling expensive marketdata feeds.
The real-time price reels
play a part in high-speed traders’ secret sauce, and many
Wall Street banks also buy
them to stay competitive.
“I am particularly interested in market data and market access, and ensuring we
have a very fair and competitive landscape,” Mr. Redfearn
said in an interview Wednesday.
Mr. Redfearn, 53 years old,
went to Evergreen State Col-
lege in Washington state and
holds a master’s degree in political science from the New
School in New York City. He
started his career not on Wall
Street but as an economic development official at the Port
Authority of New York and
New Jersey.
He joined the American
Stock Exchange in 1996 and in
2004 moved to Bear Stearns
Cos., which was acquired by
J.P. Morgan during the 2008
financial crisis.
The J.P. Morgan executive
said he would join the SEC
soon without giving a date. He
is one of the final top hires of
SEC Chairman Jay Clayton, a
Trump administration appointee who took over the regulator in May.
Mr. Redfearn is part of a
wave of Wall Street veterans
who have joined Mr. Clayton’s
staff. Mr. Clayton earlier hired
Alan Cohen, Goldman Sachs
Group Inc.’s former global
head of compliance, and David
Metzman, former chief compliance officer of hedge-fund
manager Aurelius Capital
Management LP.
Other high-ranking regulators, including Mr. Redfearn’s
predecessor as director of
trading and markets, have left
the SEC to join Wall Street
firms such as trading behemoth Citadel Securities.
“Brett’s extensive markets
experience and his longstanding, active engagement with
investors, financial services
firms, exchanges, and the SEC
CARLO ALLEGRI/REUTERS
SEC Taps Banker
As Top Regulator
For Exchanges
J.P. Morgan Chase electronic-trading executive Brett Redfearn has been a critic of some stock exchanges’ business models.
make him exceptionally wellpositioned to lead the Division
of Trading and Markets,” Mr.
Clayton said in a statement.
Part of Mr. Redfearn’s role
at J.P. Morgan involved helping long-term investors such
as mutual-fund managers navigate the Byzantine structure
of the stock market. He has
been an outspoken critic of
the regulatory privileges—
such as legal immunity—that
stock exchanges maintain despite their move a decade ago
to become for-profit companies.
The feud stems from federal
judicial decisions that found
exchanges enjoy limited liability for decisions they make as
operators and regulators of
markets. The dispute exploded
into the mainstream in 2012
when brokers complained Nasdaq Inc. didn’t adequately
compensate them for losses
stemming from the exchange’s
botched initial public offering
of Facebook Inc.
“Exchanges’ immunity and
limitations on liability provide
exchanges with an unfair advantage in areas where they
are competing with brokerdealers, alternative trading
systems, and vendors,” Mr.
Redfearn wrote in testimony
prepared for an SEC advisory
committee hearing in April.
His most immediate assignment will be shepherding the
SEC’s move to revamp incentives that exchanges offer to
attract trading.
Many large investors believe the incentives—rebates
of trading fees handed back to
brokers—skew where their orders are routed. The SEC is
preparing to propose a pilot
program that would reduce
the rebates on a sample of
stocks to see if market quality
improves.
A bigger challenge awaits
after that. Mr. Clayton has
shown an interest in reconsidering a package of SEC rules
passed in 2005, known as Regulation NMS, which helped
disperse stock trading across
more than 50 platforms, including exchanges and private
venues known as dark pools.
The fragmentation has caused
complexity that critics say has
increased breakdowns and
malfunctions.
Mr. Redfearn declined to
say whether he would support
rule changes that could rein in
the proliferation of U.S. equity
exchanges, now numbering
more than a dozen.
“Anytime somebody talks
about fragmentation, you are
also talking about competition,” he said. “We are in a
very pro-competition environment.”
“It’s going to be important
to go back and discuss these
issues with the chairman, the
other commissioners and the
staff, and see how we can
work together to arrive at
some more efficient outcomes,” he added.
Some Republican critics of
the rules, including former
SEC Commissioner Paul Atkins, argue the rules also
stripped brokers of discretion
for how to best fill clients’ orders. Mr. Redfearn declined to
say how he might approach an
overhaul of the rules, but signaled the time is right for an
in-depth review.
“It’s been 10 years since the
implementation of Regulation
NMS and certainly it’s time to
revisit that set of rules,” he
said. “The SEC is more in control of its agenda and it’s a
good place to focus on some of
these important issues.”
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B12 | Thursday, October 19, 2017
THE WALL STREET JOURNAL.
MARKETS
The Dow’s Darkest Day, 30 Years Later
The stock market crashed 30 years ago.
The Dow Jones Industrial Average dropped 508 points on Oct. 19, 1987,
in what became known as Black Monday.
The 22.6% decline remains its biggest ever.
Dow’s biggest single-day point declines
0
Sept. 17,
2001
Oct. 19,
1987
20000
April 14,
2000
Sept. 29,
2008
Oct. 27,
1997
15000
–250
Nominal
Inflation adjusted*
–500
10000
–750
–1,000 pts.
Black Monday
Oct. 19, 1987
5000
1738.74
t22.6%
Dow Jones Industrial Average
0
1984
’90
2000
’10
’17
The selloff was driven in part by computer
programs that automatically sold index futures
when the market fell, exacerbating declines. It
was an early sign of the algorithm-driven trading
that has since become prevalent on Wall Street.
The plunge rapidly spread around the globe
during the course of that Monday and
Tuesday. Since then, global markets have
only become more interconnected, often
taking their cues from one another.
It also hit blue-chip stocks hard.
Shares of some of the best-known
U.S. companies—many of which have
since merged or taken on a lower
profile—declined more than the index.
In the mid-1980s, stocks broadly benefited from
declining interest rates. But rates climbed in 1987
as the Federal Reserve tightened policy, and an
autumn spike in Treasury yields is widely
regarded as a proximate cause of the crash.
New York Stock Exchange trading volume
on Oct. 19, 1987 and the previous Monday
Two-day percentage drop
from Friday, Oct. 16, 1987
Largest percentage declines by
Dow components on Oct. 19, 1987
Yield on the 10-year Treasury note
Black Monday
Oct. 19, 1987
10.2%
Previous Monday
60 million shares
40
20
9:30 10
Australia’s All Ordinaries
USX
U.K.’s FTSE 100
Westinghouse Electric
Japan’s Nikkei 225
Bethlehem Steel
Canada’s S&P TSX
Eastman Kodak
Euro Stoxx
Allied-Signal
Spain IBEX 35
Goodyear
11
noon
1
2
3
9
6
3
Procter & Gamble
Korea’s Kospi
0
12%
4
–30%
–20%
–10%
0
–40%
0%
–30%
*Based on September 2017 consumer-price index
Sources: WSJ Market Data Group (Dow); U.S. Bureau of Labor Statistics (CPI); The Wall Street Journal, Oct. 20. 1987 (volume); FactSet (two-day changes, stocks); Ryan ALM (yield)
–10%
0%
1985
1990
FINANCIAL ANALYSIS & COMMENTARY
Put Retailers on Your Holiday List
Short Change
Median short interest as a share of float for six major U.S. retailers*
8%
6
4
2
0
2007 ’08
’09
’10
’11
’12
’13
’14
’15
’16
’17
*Wal-Mart Stores, Costco Wholesale, Target, Best Buy, TJX, Macy's
Source: FactSet
THE WALL STREET JOURNAL.
est brick-and-mortar retailers by sales, excluding
hardware, drug and grocery
stores. Among that group,
which includes Wal-Mart,
Costco Wholesale, Target,
Best Buy, TJX and Macy’s,
median short interest as a
portion of shares available
for trading is 6.7%. That
compares with a peak of
6.6% in July 2008, when the
economy was crumbling.
Analysts, unsurprisingly,
are giving retailers low rat-
ings. Just 28% of analysts
covering Macy’s are giving it
a “buy” or “overweight” rating, according to FactSet.
High short interest, low
ratings, neglect: These are
the things value investors
are supposed to love. One of
them, William Smead of
Smead Capital Management,
says investors are pricing retailers as if the online threat
will be as damaging as a depression in overall discretionary spending. He likes
Target, which has steadily
raised its dividend, not the
sign of a store struggling to
survive.
Meanwhile, management
teams at a number of
beaten-up retailers are buying their companies’ shares.
Macy’s Chief Executive Jeffrey Gennette bought the
store’s stock last year, lost
money on it, and came back
this year and bought two
more slugs. The Nordstrom
family wanted to take Nordstrom private, but suspended their efforts this
week after struggling to
raise financing for a deal.
The holiday season is approaching, and falling unemployment and rising wealth
should keep consumers
shopping. At the least, investors should recognize that
even if the next few months
are bad for retailers, they
might not be as bad as
feared. And investors should
also consider that the threat
from Amazon, while bad,
might not be existential, at
least for the best retailers. If
so, there are bargains to be
had.
—Justin Lahart
OVERHEARD
In today’s videogame business, you’re only as good as
your next theoretical hit.
Electronic Arts experienced that Wednesday as its
stock price fell in a reaction
to the company’s decision to
close one of its development
studios and push the “Star
Wars” game it was making
out of its next fiscal year.
EA’s Visceral Studio was developing the game as a
“story-based, linear adventure,” but the company said it
felt the need to “pivot the
design” after testing the concept with players.
The move caused several
analysts to adjust their forecasts downward for the fiscal
year ending in March 2019.
But game pipelines can shift
a lot in that time, and EA’s
fiscal 2019 still is expected to
be anchored by a new sequel
to its popular “Battlefield”
franchise.
Meanwhile, the company
is on track to launch “Star
Wars Battlefront II” next
month. That should keep the
Force with the company for a
while.
Reckitt’s Makeover Clears the Way for Bid on Pfizer Unit
Reckitt Benckiser Group
is doing nothing to dispel
speculation that it wants
Pfizer’s nonprescription
drugs.
This year, the Londonlisted consumer company
sold its last food brands.
Now, it is reorganizing its
remaining portfolio into two
distinct business units. One
will make household cleaning products like Lysol, the
other drugstore staples such
as Mucinex.
Chief Executive Rakesh
Kapoor said the move would
create more accountability.
Activist Nelson Peltz has
pushed for this kind of move
at Reckitt’s U.S. peer Procter
& Gamble. Like P&G, Reckitt
has suffered a string of poor
results. Like-for-like sales
fell 1% year over year in the
third quarter, a small improvement on the 2% second-quarter decline, its
worst result in years.
The reorganization could
be helpful operationally but
also be seen as a prelude to
a sale or demerger of the
cleaning brands. Mr. Kapoor
has long implied that consumer health, not home hygiene, is Reckitt’s sweet
spot, formalizing this hierarchy by saying Wednesday
that he would run the health
business directly, with the
“hygiene home” boss reporting to him.
Pfizer said last week that
it was considering a sale or
spinoff of its over-the-counter unit, which makes Advil
and Centrum. It has long
been seen as a target for
Reckitt in its pivot toward
consumer health care. If
Reckitt’s household-cleaning
division were easier to spin
out, investors—and ratings
firms—would find a bid for
Pfizer’s consumer assets
more palatable.
The problem is that
Reckitt’s acquisition of U.S.
infant formula company
Mead Johnson in June already saddled it with debt.
Adjusting for the sale of food
brands in August, Bernstein
analyst Andrew Wood expects net debt to be roughly
Unhealthy
Reckitt Benckiser's net debt
to trailing Ebitda*
5 times
4
3
2
1
0
2012 ’13
June 15, 2017
Acquisition of Mead
Johnson closes
’14
2000
2010
Ben Eisen, Ken Jimenez and Tom Destefano/THE WALL STREET JOURNAL.
HEARD ON THE STREET
Email: heard@wsj.com
Retail stocks are, as the
Wall Street cliché puts it,
cheap for a reason. But are
they too cheap?
It has been a lousy year
for nearly every U.S. retailer
not named Amazon.com.
The online giant continues to
gain share while driving its
brick-and-mortar peers to
cut prices and spend to
boost e-commerce. Wal-Mart
Stores plans to open fewer
stores than it has in the past
25 years, while many other
retailers are closing stores
outright. Toys “R” Us is the
latest to file for bankruptcy.
Investors have no faith in
the possibility of a turnaround. In what has been a
very good year for the stock
market, retail stocks have
fallen sharply. In any other
era, they would probably
look like bargains. Department stores in the broad
S&P 1500, for example, trade
at 9.9 times expected earnings, according to FactSet,
versus the overall index’s
price/earnings ratio of 18.1.
Indeed, the betting
against retail stocks is intense. Consider the six larg-
–20%
’15
’16
’17
*Earnings before interest, taxes, depreciation
and amortization
Source: FactSet
3.1 times a full year’s earnings before interest, taxes,
depreciation and amortization. This would increase to
almost 6 times if it bought
the Pfizer unit.
Reckitt didn’t rule out an
increase in leverage Wednesday. Its chief financial officer
said the company would be
prepared to see its credit
rating fall a notch to triple B
“if something spectacular
came along” as long as it
had a “focused” path back to
single A. Selling the cleaning-products division is one
such path.
Growth in the consumerhealth industry is slowing.
Reckitt has historically been
one of the consumer industry’s most active deal makers, but others may want to
bulk up, too. Mr. Kapoor
seems to be moving early to
show investors—and rivals—
that he is still in the bidding
game.
—Stephen Wilmot
WSJ.com/Heard
Anthem Goes
It Alone Over
Drug Prices
The way health insurance
companies pay for prescription drugs is changing. That
should please insurance
shareholders and worry investors in pharmacy-benefit
managers.
Anthem, the second-largest U.S. insurer by membership, said Wednesday that it
would start its own pharmacy-benefit manager in
2020, when its contract with
Express Scripts Holding expires. Anthem’s shares rose
2.4% on Wednesday.
The break with Express
Scripts isn’t a shock. Anthem
sued Express Scripts in 2016,
alleging that it had been
overcharged for prescription
drugs by $15 billion over
several years. Express
Scripts denies the charges
and has filed counterclaims.
In theory, pharmacy-benefit managers exist to reduce
drug costs for customers like
Anthem.
The steady rise of prescription-drug prices is putting its effectiveness, and its
future in question. Shares of
Express Scripts are down
14% this year.
By taking the business in
house, Anthem could see its
earnings rise by $1.50 a
share annually, analysts at
Leerink Partners said in a
note Wednesday.
Shares of UnitedHealth
Group, the largest insurer,
are up 75% since it bought
pharmacy-benefit manager
Catamaran in 2015. UnitedHealth reported strong thirdquarter results on Tuesday,
driven largely by profit
growth in its health services
unit, which includes its pharmacy-benefit manager.
If you want something
done right, the saying goes,
do it yourself. Health insurers are taking heed. Investors should, too.
—Charley Grant
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