All posts by minghehu2018

Chicago residents grapple with saving and spending

By Minghe Hu
Medill Reports

As a father of eight children, George Grea works hard at two jobs to pay off debts, his mortgage and to save money. Troubled by spending more than he should with his credit cards, the 47-year-old parent got rid of all of them and decided to build up his credit score slowly, he said.

Going shopping made him feel good and credit cards made expensive products seem affordable to him, so he couldn’t stop himself from overspending on things he didn’t need, Grea said. ​ Continue reading

Boeing is strong despite drop in stock price

By Minghe Hu
Medill Reports

Wall Street expects the stock performance of Boeing Co. will overcome the turbulence of trade war with China because of strong market demand, although its stock price shows that investors have concerns.

The Chicago-based airplane behemoth is one of the largest commercial aircraft makers and defense contractors in the world. Its products include the narrow-body 737 family, the wide-body 787 family and KC-46 and Apache military aircraft.

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ChiHuo Chicago builds a bridge between foodies and restaurants

By Minghe Hu
Medill Reports

ChiHuo means foodie in Mandarin, and a two-year-old online promoter of Chinese food called ChiHuo Chicago has a growing following in the Chinese community. It’s one of nine such ventures around the country operated by Chinese parent ChiHuo.

As a startup, ChiHuo Chicago has grown from a personal social medium to an online social influencer platform with 300,000 subscribers in Chicago. And its user base is expanding to English speakers.

Photo at top: Foodie Map of ChiHuo Chicago.(Minghe Hu/MEDILL)

Cboe outlook just fine despite VIX-related angst, analysts say

By Minghe Hu
Medill Reports

As inverse-VIX trading dried up during the stock market’s 10-percent correction in February, shares of VIX originator Cboe Global Markets Inc. plummeted a startling 18 percent. But, buoyed by reassuring words from Cboe’s chief executive officer, the high-flying stock partially recovered and the exchange’s outlook remains solid for 2018 in the eyes of analysts.

CEO Richard Tilly, in a conference call as the market bottomed out, pointed out that Cboe’s revenues from inverse-VIX products account for only 5 percent of total VIX futures revenues. The VIX, or volatility index, rose sharply and volume boomed as the market peaked and plummeted, but trading in the VelocityShares Daily Inverse VIX Short-Term ETN (NYSEARCA: XIV) and ProShares Short VIX Short-Term Futures ETF(NYSEARCA: SVXY) collapsed.

Chief Strategy Office John Deters added that “people did not flee the short-VIX strategy.”

He went on: “Buy side users are coming into the VIX market that generates activity from the market-maker community in a ratio of about 3:1. So every new contract that comes in from a customer, spins up three new contracts from market-makers approximately. And that’s the kind of benefit of having more participants doing more business in the VIX futures markets.”

Richard Repetto, an analyst at Sandler O’Neil & Partners LP said in an interview via phone this week, “I think they will continue to grow and powered by proprietary products, and the technology platform migrations [from Cboe’s 2017 acquisition of the BATS stock exchange] will help them as well. Their stock grew dramatically last 15 days,” suggesting that the further appreciation in the near future is unlikely. The price/earnings ratio of Cboe stock is still a lofty 44.93, far above the S&P 500 trailing P/E ratio of 25.68.

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Can robots solve the aging problem in Japan’s work force?

By Minghe Hu
Medill Reports

It’s getting hard for employers to find qualified workers in Japan, and a rapidly aging society is the reason for the worker shortage.

Robots may help.

In September 2017, 28 percent of the population was over 65 years old, according to the Ministry of Internal Affairs and Communications of Japan. The size of the working-age population declined 13 percent to 76.7 million from 86.6 million between 2000 and 2016, according to a research paper by Daiji Kawaguchi. The ratio of job openings to applicants is 1.59, up 11 percent compared with the same time last year.

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ICE Earnings Narrowly Beat Estimate

By Minghe Hu
Medill Reports

Intercontinental Exchange (NYSE: ICE), which owns the New York Stock Exchange, reported Wednesday net earnings roared 248 percent to $1.2 billion, or $2.08 per diluted share, in its fourth quarter ended Dec. 31, 2017, from $352 million, or 59 cents per diluted share, a year earlier, assisted by a $764 million benefit from U.S. tax reform.

Excluding the tax benefit, the company reported $433 million, or 73 cents per diluted share, up 1 percent compared with $428 million, or 71 cents per diluted share, a year earlier, surpassing the Wall Street expectation of 72 cents per share. Total revenue excluding transaction-based expenses, was $1.14 billion, flat compared with the quarter a year ago.

Quarterly revenues of ICE  Source: Bloomberg. Feb. 7, 2018 (Minghe Hu/MEDILL)
Quarterly revenues of ICE have been growing over the years, though less recently. Source: Bloomberg. Feb. 7, 2018 (Minghe Hu/MEDILL)

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ADM earnings beat expectation

By Minghe Hu
Medill Reports

Archer-Daniels-Midland Co. (Nasdaq: ADM) reported net earnings boomed 86 percent to $788 million, or $1.39 per diluted share, in its forth quarter ended Dec. 31, 2017, from $424 million, or 73 cents per diluted share, a year earlier, helped by $379 million, or 73 cents per share, from the U.S. tax reform.

Without the tax benefit, the Chicago-based company reported $463.30 million in net income, or 82 cents per diluted share, up 6 percent compared with $437.25 million, or 75 cents per diluted share, a year earlier, exceeding the Wall Street expectation of 70 cents per share. However, revenue decreased 2.6 percent to $16.07 billion from $16.50 billion in the same quarter a year ago.

Revenue of ADM from 2015 to 2017. Source: Bloomberg. Feb. 6, 2018(Minghe Hu/MEDILL)
Quarterly revenues of ADM are no higher than three years ago. Source: Bloomberg. Feb. 6, 2018(Minghe Hu/MEDILL)

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CME Group Earnings Beat Expectations

By Minghe Hu

Medill Reports

CME Group Inc.(Nasdaq:CME), the world’s largest futures exchange, reported Thursday net income roared to $2.9 billion, or $8.63 per diluted share, in its fourth quarter ended Dec. 31, from $373.4 million, or $1.10 per diluted share a year earlier, assisted by a $2.4 billion tax benefit as a result of tax reform.

“We are very pleased with the tax reform. We believe it’s good for our customers, intermediaries, and good for the markets,” said John Peschier, managing director of investor relations of CME, in a conference call.

Adjusted to exclude the tax benefit, income was $383 million, or $1.12 per diluted share, down 1.1 percent compared with $387.3, or $1.14 per share, in the same quarter a year ago, exceeding the Wall Street expectation of $1.09 per share. Revenue decreased 1.4 percent to $900 million from $912.9 million.

Quarterly Revenues of CME Group. Source: Bloomberg

Quarterly Revenues of CME Group. Source: Bloomberg. Feb. 1, 2018(Minghe Hu/MEDILL)

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U.S. Jobless Claims Point to a Healthy Labor Market

By Minghe Hu
Medill Reports

The number of Americans filing for initial unemployment insurance benefits, seasonally adjusted, increased to 233,000 in the week ended Jan. 20 from the revised 216,000 in the prior week, according to the Labor Department.

The four-week moving average of initial claims, a better indication of the recent trend, fell 3,500 to 240,000 from the previous week’s revised average.

4-Week Moving Average of Initial Claims, Source :Labor Department via the Federal Reserve Bank of St.Louis, Jan. 25, 2018
4-Week Moving Average of Initial Claims, Source :Labor Department via the Federal Reserve Bank of St.Louis, Jan. 25, 2018. (Minghe Hu/MEDILL)

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