The Wall Street Journal - 22.08.2019

© 2019 Dow Jones & Company. All Rights Reserved. *** THE WALL STREET JOURNAL.** Thursday, August 22, 2019 |B1

PERSONAL TECHNOLOGY: THE ROBOCALL HAS AN EVIL TWIN — THE ROBOTEXT B4

BUSINESS&FINANCE

U.S. corporations are repur-
chasing their own shares at
the slowest pace in 18 months,
a potential sign of more vola-
tility as the buyback bonanza
from the corporate-tax over-
haul wanes.
Companies in the S&P 500
repurchased about $166 billion
of their own stock in the sec-
ond quarter, S&P Dow Jones
Indices projects, down from
$205.8 billion in the first
quarter and $190.6 billion in
the same period a year ago.
That marks the lowest total
since the fourth quarter of
2017 and the second consecu-
tive quarter of contraction.
What alarms some inves-
tors is that companies eased
up on share repurchases even
as volatility surged amid a
trade dispute between Wash-
ington and Beijing.
The S&P 500 slumped al-
most 7% in May, but the buy-
back data suggest companies
didn’t step in to support their
stock prices the way they did
during the final months of
2018.
That is a sign that corpora-
tions are potentially tighten-
ing their wallets as executives
grapple with new tariff threats
in the long-simmering trade
dispute with China; weakening
corporate earnings; signs of a
downturn in global growth
and uncertainty over the Fed-
eral Reserve’s interest-rate
policy.
Apple Inc., Cisco Systems
Inc. and Amgen Inc. were
among the biggest spenders
Please turn to page B2

BYJESSICAMENTON

political uncertainty in the city,

according to people familiar

with the matter. Alibaba execu-

tives were also concerned

about the optics of one of

China’s highest-profile compa-

nies listing in Hong Kong amid

the protests, one of the people

said.

The decision was made in

recent days by Alibaba’s board,

this person said, adding the

company was in wait-and-see

mode given the fluid situation.

Alibaba plans to revisit its

plans later in the year, assum-

ing the turmoil will have less-

ened by then, but no new time-

line has been set, the person

said. The decision was earlier

reported by Reuters.

An Alibaba spokesman said

the company doesn’t comment

on market rumors.

Alibaba shares have traded

in New York since 2014. In

June, people familiar with the

Please turn to page B6

Alibaba Group Holding Ltd.

has postponed plans for a mul-

tibillion-dollar share listing in

Hong Kong, as protests now in

their third month exact a deep-

ening economic cost.

The Chinese e-commerce

company was on track to

launch the sale in the coming

weeks but put that plan on hold

due to market instability and

BYANUPREETADAS

ANDSTELLAYIFANXIE

Alibaba Puts Hong Kong Listing

On Hold Amid Protests in City

BUSINESS

Auto makers

are caught in a

crossfire over

U.S. emissions rules B3

MANAGEMENT

Employers revamp job

postings to appeal

to a wider set

of applicants B6

S&P 2924.43À0.82% S&PFIN À0.46% S&PIT À1.18% DJ TRANS À1.01% WSJ$IDX À0.10% LIBOR3M 2.148 NIKKEI (Midday) 20648.60À0.15% See more at WSJ.com/Markets

Companies Slow Down Buybacks

S&P 500 firms cut

share repurchases by

a projected $40 billion

in second quarter

promotional rate—one that

eventually gives way to a

higher price.

Major internet service pro-

viders including Comcast,

Charter and AT&T say they do

offer complimentary speed up-

grades to customers, and dis-

close that in emails or on a

user’s bill. They say any fee in-

creases down the road are un-

related to those higher-speed

packages and simply reflect

normal pricing changes.

The companies say consum-

ers are demanding faster

speeds to stream more high-

resolution video and use more

devices in their home net-

works. “To meet this increas-

ing demand for data, Comcast

has made many investments in

its network and products and

has increased speeds 17 times

in 18 years,” a Comcast

spokeswoman said.

An AT&T spokesman said

the company often offers

“speed upgrades as a ‘thank

you’ to loyal customers at no

additional cost.” The company

occasionally raises rates, but

“that applies to every cus-

tomer in a particular pricing

tier,” the spokesman said.

Ben Kurland, co-founder of

the company BillFixers, which

haggles with providers for

lower bill prices on behalf of

their customers, said while

many consumers seek up-

grades, many are moved up

Please turn to page B4

Melissa Shank and her fi-

ancé moved into their apart-

ment in late 2016 and bought

a $90-a-month cable and in-

ternet package.

Two years later, the couple

noticed their bill had spiked to

$121. When they complained

to their provider, Comcast

Corp., they were told their

speed had been boosted from

75 megabits per second to 150

Mbps, without their request-

ing it.

There was no additional

cost at first, but price in-

creases kicked in after promo-

tions and discounts ran out.

“It just doesn’t seem appropri-

ate,” said Ms. Shank, who lives

in Lock Haven, Pa. “I wouldn’t

be surprised if they purposely

make the billing messy.”

Cable and telecom compa-

nies like Comcast, Charter

Communications Inc. and

AT&T Inc. are leaning heavily

on their broadband businesses

to propel growth as demand

for TV subscriptions declines.

They are using a range of

tactics to shift consumers onto

faster, premium speed tiers. In

some cases, that means boost-

ing speeds initially free, then

raising fees later. Some con-

sumers say that when they call

to complain about their bill,

the provider assuages them by

offering a higher speed at a

BYPATRICKTHOMAS

ANDLILLIANRIZZO

‘Free’ Speed Upgrades

Inflate Internet Bills

INSIDE

WASHINGTON—Public com-
panies notched a victory in a
longstanding fight to curb the
impact of consultants who in-
fluence shareholder votes on
topics such as executive pay.
A divided Securities and Ex-
change Commission voted 3-2
Wednesday to urge the con-
sulting firms—known as proxy
advisers—to take more steps
to disclose how they craft
their shareholder recommen-

dations, issuing a broad warn-

ing for proxy advisers that

convey incorrect information.

The SEC also voted to issue

new guidance to mutual-fund

managers that outlines steps

they should consider if they

become aware of potential fac-

tual errors or weaknesses in

analysis from a proxy adviser.

The moves target Institu-

tional Shareholder Services

Inc. and Glass Lewis &Co.,

two firms that dominate the

industry with 97% market

share.

Proxy advisers say institu-

tional investors rely on their

research and recommenda-

tions to make informed deci-

sions about how to vote their

clients’ shares. They have dis-

puted claims about inaccura-

cies in their recommendations.

The SEC’s two Democratic

members, Robert Jackson and

Allison Lee, dissented, saying

the guidance would impose

new costs that will encourage

even greater concentration in

the proxy-advisory industry.

Mr. Jackson warned the

moves could also lead smaller

fund managers to stop voting

on corporate ballots—boosting

the influence of larger inves-

tors.

Gary Retelny, ISS President

and CEO, said his firm is “con-

cerned that aspects of the

guidance may significantly un-

dermine our ability to deliver

independent, timely and accu-

rate research, data, insights

and perspectives to aid in the

discharge of our clients’ fidu-

ciary duties.”

He said ISS will carefully

review Wednesday’s guidance

“to understand the potential

impacts for our clients as well

as to consider further actions

that could improve the ability

of our clients to meet their fi-

duciary obligations in a cost

effective manner.”

Glass Lewis didn’t respond

to requests for comment.

SEC officials described the

Please turn to page B10

BYANDREWACKERMAN

SEC Moves to Boost Proxy Advisers’ Disclosures

$6.5B $6.3B

Bank of

America

$5.2B $5.1B

JPMorgan

Chase

$4.9B $5.1B

Wells

Fargo

$4.6B $4.8B

Microsoft

$0.5B

$4.1B

Johnson

Controls

$3.6B

Alphabet

$4.9B $6.1B

Cisco

Systems

$10.0B

$6.3B

Oracle

Total S&P 500 buybacks, quarterly*

$200 billion

2000 ’05 ’10 ’15 ’19

S&P 500 BULL MARKETS †

0

50

100

150

Sources: S&P Dow Jones Indices; Dow Jones Market Data (bull markets)

*2Q 2019 is preliminary †Gray bands indicate quarters in which the index was in a bull market for a majority of trading days.

A shorter bull run from Nov. 20, 2008, to Jan. 6, 2009, is not reflected in the chart.

Buybacks, by quarter

Apple

2Q 2019

$18.2B

1Q 2019

$23.8B

$3.0B

$3.5B

Citigroup

$4.4B

Technology

$52.4B

Financials

$37.8B

Industrials

$17.0B

Health care

$16.7B

Consumer

discretionary

$10.8B

Communication

services

$7.1B

Consumer

staples

$6.8B

Energy

$4.6B

Materials

$2.4B

Utilities

$0.9B

Real Estate

$0.6B

Total S&P 500 buybacks in the 2Q by sector*

Retailers offering deals,

from bargains on brand-name

goods to conveniences such as

free shipping, are snaring cus-

tomers at the expense of

chains that have been slow to

innovate.

Walmart Inc., Target Corp.

and T.J. Maxx parent TJX Cos.

have reported strong sales

growth and an uptick in visi-

tors to their stores. Macy’s

Inc., J.C. Penney Co., Nord-

strom Inc. and other middle-

market chains continue to

struggle.

“The common thread

among retailers that are doing

well is that they offer some

type of value,” said Chuck

Grom, senior analyst at Gor-

don Haskett Retail Advisors.

“But, today, value is about

more than just price. It’s also

about convenience.”

Convenience can take many

forms. It can mean pulling into

a Walmart or T.J. Maxx park-

ing lot and dashing directly

into the store, rather than nav-

igating a shopping mall maze.

It can also mean free two-day

shipping, no minimum pur-

chase required, as Target of-

fered last holiday season.

On Wednesday, Target said

sales at its stores open at least

a year rose 3.4% for the three

months ended Aug. 3, and it

raised its guidance for full-

year earnings. Total revenue

for the recent period increased

3.6% to $18.4 billion. Profit

climbed to $938 million from

$799 million a year earlier.

Target’s shares soared 20%

to close at $103, their largest

single-day gain on record.

Home-improvement retailer

Lowe’s Co. also reported

higher sales and earnings on

Wednesday, though some of

the profit increase came from

cost cutting.

A day earlier, TJX said sales

at stores open at least a year

rose 2% in the most recent

quarter, which was lower than

what some analysts had ex-

pected but on top of a 6% in-

crease a year earlier. TJX Chief

Executive Ernie Herrman told

analysts that customer traffic

to its stores—growing for 20

Please turn to page B2

BYSUZANNEKAPNER

Shoppers

Reward

Nimble

Retailers

 Heard on the Street: Retailers

prosper as Fed frets............ B12

Hong Kong officials have worked hard to court Alibaba and other prestigious Chinese companies.

ANDREY RUDAKOV/BLOOMBERG NEWS