Asian stocks fell in choppy trade on Tuesday as the political tinderbox in the Middle East and the Korean Peninsula added to uncertainty over the looming French vote, pushing edgy investors into safer assets such as the yen and Treasuries. Oil continued its steady climb on supply concerns in the wake of U.S. missile strikes on a Syrian air base last week, and a shutdown at a Libyan oilfield. MSCI’s broadest index of Asia-Pacific shares outside Japan . MIAPJ0000PUS swung between gains and losses and was last down 0.4 percent. “Most Asian markets could be seen with moderate changes this morning amid a mixed trend,” said Jingyi Pan, market strategist at IG in Singapore. “Price movements here appear to be largely mirroring those in the U.S., with key corporate earnings due later in the week and could be the reason that investors are still holding onto equities.”The heightened geopolitical risks come at a time when the global economy has shown steady improvement, led by the United States and encouraging momentum in export-reliant Asia. Tokyo’s Nikkei . N225 slipped 0.5 percent, dragged lower by a stronger yen. The declines were led by Toshiba Corp. (6502. T), which slumped 4.3 percent, with the conglomerate expected to file its twice-delayed earnings results on Tuesday, possibly without a full sign-off by auditors. Accountants question the numbers at the company’s U.S. nuclear subsidiary Westinghouse Electric Co., where massive cost overruns have pushed the Japanese parent company to the brink. Chinese stocks fell about 0.1 percent . CSI300 and Hong Kong shares . HSI surrendered earlier gains to slide 0.7 percent. South Korean shares . KS11 and Taiwan . TWII were also lower. Australian stocks reversed earlier losses to climb 0.5 percent, after a measure of business conditions hit the highest level in a decade. They earlier hit their highest level since April 2015 for the second session in a row.

The Australian dollar AUD=D4 fell 0.1 percent to $0.7494, reversing earlier gains. Overnight, Wall Street ended a choppy session little changed, weighed down by nervousness about quarterly corporate earnings later this week. The depressed sentiment pulled 10-year U.S. Treasury yields down to 2.3463 percent on Tuesday from Monday’s 2.361 percent close. British Prime Minister Theresa May spoke on Monday with U.S. President Donald Trump and agreed that “a window of opportunity” exists to persuade Russia to break ties with Syrian President Bashar al-Assad, May’s office said. Trump is open to authorizing additional strikes on Syria if the use of chemical weapons continues in the country, the White House said on Monday.

Investors are also nervous about the possibility of U.S. military action against North Korea after the strikes in Syria. A U.S. Navy strike group headed toward the western Pacific Ocean near the Korean peninsula as a show of force, while China and South Korea agreed on Monday to tougher sanctions on North Korea if it carries out nuclear or long-range missile tests. In France, polls for many weeks have been showing centrist Emmanuel Macron and far-right leader Marine Le Pen on track to top the first round of voting on April 23 and go through to a May 7 runoff. While Le Pen’s plans to ditch the euro and hold a referendum on European Union membership have spooked many investors, recent polls have pointed to a tighter race, with support for far-left candidate Jean-Luc Melenchon surging recently.”After Britain’s Brexit referendum and the U.S. presidential election surprised markets in 2016, could this event do the same?,” Mark Burgess, global head of equities at Columbia Threadneedle in London, wrote in a note.

“As a Le Pen presidency is perceived to increase the likelihood of France’s withdrawal from the EU, the uncertainty is likely to continue about what this could mean for the euro, along with a potential wider hit to global markets.”The euro EUR=EBS pulled back 0.1 percent to $1.0585. The dollar fell 0.2 percent to 110.68 yen JPY=, extending losses from Monday. The dollar index . DXY, which tracks the greenback against a basket of major trade-weighted peers, was flat at 101.05, failing to rebound from Monday’s 0.16 percent loss. Oil prices retained recent gains that have pushed them to five-week highs, on a shutdown at Libya’s largest oilfield over the weekend and the U.S. strikes against Syria. U.S. crude CLc1 was little changed at $53.09 a barrel, lingering near a five-week high touched earlier in the session. Global benchmark Brent LCOc1 was also steady at $56.01, following six straight sessions of gains The market jitters and a weaker dollar supported gold, which retained gains from its two prior sessions. Spot gold XAU= was fractionally higher at $1,254.89 an ounce.

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“Macro” hedge funds are back in favor with investors seeking to take a view on U.S. President Donald Trump’s economic policies, European elections, or interest rates, but it is start-up funds rather than established players which are attracting cash. Some of the main beneficiaries of the macro revival are managers who cut their teeth at the big macro firms such as Moore Capital Management, Brevan Howard and Tudor Investment Corp, which made their names for outperformance in 2007-2009. Eric Siegel, head of hedge funds at Citi Private Bank (C. N), said in general that macro strategies are likely to thrive. “With volatility coming back and monetary supply tightening, we believe it could be a great environment for macro managers,” Siegel said. Macro funds bet on macroeconomic trends using currencies, bonds, rates and stock futures. They outperformed the broader industry during the financial crisis and amassed tens of billions of dollars between 2010 and 2012. But they lost most of those assets between 2013 and 2014 and also in 2016 for a variety of reasons, including performance. But macro is back in vogue and was the most popular hedge fund strategy among investors in the fourth quarter of 2016 and the first two months of this year, according to industry data providers Preqin and eVestment. Moore Capital’s Louis Moore Bacon, Alan Howard, who co-founded Brevan Howard, and Paul Tudor Jones of Tudor Investment were among the macro stars after years of delivering double-digit returns. But during the lean years, when macro was less in favor, they had to cut fees and in some cases staff. Now newcomers, such as Moore Capital spin-out Stone Milliner, are pulling in cash and producing some strong returns. Stone Milliner’s discretionary global macro closed to new money last year after taking in over $4 billion in the previous two years. Moore Capital’s assets have fallen slightly from $15 billion in 2012 to $13.3 billion as of Dec. 31 2016, filings with the U.S. Securities and Exchange Commission (SEC) showed.

Anglo-Swiss firm Stone Milliner, set up in 2012 by former Moore Capital portfolio managers Jens-Peter Stein and Kornelius Klobucar, averaged returns of 8.3 percent between 2014 and 2016, a source told Reuters, while Moore Capital Management averaged 3.4 percent, a second source said. London-based Gemsstock, set up in January 2014 by Moore Capital trader Darren Read and his co-founder Al Breach, made 12.8 percent on average over the same period, documents seen by Reuters showed. Chris Rokos, a Brevan Howard alumnus, raised another $2 billion in February after returns of 20 percent in 2016. EDL Capital made gains of 18.4 percent last year after ex-Moore Capital trader Edouard De Langlade launched the firm in September 2015, according to a source close to EDL Capital. It has amassed assets of $450 million to date, he said. Ben Melkman, who also formerly worked at Brevan Howard until May 2016, raised over $400 million for his launch in March, SEC filings showed.

Brevan Howard’s firm-wide assets fell to $14.6 billion in 2017, from $37 billion in 2012. [here]RUSH FOR MACRO But the old guard are fighting back. Some have been cutting fees and offering alternatives. Howard, Brevan Howard’s co-founder, last month launched a new fund managed solely by him, which sources said has already amassed more than $3 billion. Tudor Investment lowered its management fees to 1.75 percent and performance fees to 20 percent in February after a reduction last year and Moore Capital cut the management fee on its Moore Macro Managers fund to 2.5 percent from 3 percent.

Tudor Jones laid off 15 percent of staff in August. The firm’s main Tudor BVI Global Fund started 2017 down 0.6 percent to March 3 after gaining 0.9 percent in 2016. Brevan cut its management fees to zero for some current investors in its Master Fund and its Multi-Strategy fund last September after a similar move from Caxton Associates. But for both the old and new macro funds, it is still to be determined what 2017 will hold. Even though macro funds are flat on average for the first two months of 2017, making gains of just 0.38 percent, according to Hedge Fund Research, the popularity of macro strategies is not in doubt. A Credit Suisse survey in March of more than 320 institutional investors with $1.3 trillion in hedge funds showed macro was set to be the favorite strategy of 2017. Preqin data showed that after pulling assets out of macro for three back-to-back quarters, investors added $6.4 billion to the strategy in the fourth quarter of 2016 after Trump’s win.eVestment data showed that macro funds have pulled in $4.4 billion in the first two months of 2017, demonstrating a turnaround from 2016 when investors took $9.8 billion out of macro after withdrawing $10 billion in 2013 and $19.1 billion in 2014.”I don’t think macro is dead. Managers who can be nimble and are able to look outside the large liquid asset classes can still find great opportunities,” Erin Browne, head of Global Macro Investments at UBS O’Connor, said. Representatives at Tudor did not immediately respond to a request to comment. Moore Capital had no comment. A spokesman at Brevan declined to comment.

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Jana Partners has upped its stake in Whole Foods Market Inc (WFM. O) as the hedge fund looks to shake up the board and senior management of the high-end grocer and push for a sale of the company that has been losing ground in the natural and organic niche it popularized. Whole Foods’ shares, which have lost nearly half their value since early 2015, jumped almost 10 percent to close at $34.17 on Nasdaq. Jana announced a 8.3 percent stake in Whole Foods in a regulatory filing on Monday, up from the 7.15 percent it held at the end of last month, according to Thomson Reuters data. The New York-based activist investor, which usually works behind the scenes, is mounting an increasingly public campaign for change at the Austin, Texas-based grocer. Jana said in its filing that it had started a review of strategic options for Whole Foods in light of the company’s “apparent unwillingness to engage in discussions with third parties regarding such alternatives.” ( other hedge funds mounting proxy contests, Jana has assembled a group of industry experts it feels can add hands-on knowledge to running the business. Former Gap Inc (GPS. N) Chief Executive Glenn Murphy, former Harris Teeter Supermarkets CEO Thomas “Tad” Dickson and former Barclays stock analyst Meredith Adler have agreed to be on Jana’s slate of nominees, the hedge fund said in its filing.

Jana said it is also working with former Safeway chief marketing officer Diane Dietz and food writer Mark Bittman as consultants. Murphy bought $44 million worth of Whole Foods stock, while Dickson, Adler, Dietz and Bittman bought smaller amounts of stock, according to Jana’s filing. The filing also disclosed that Jana plans to “internalize grocery distribution and limit the influence of its primary wholesale distribution partner,” United Natural Foods Inc (UNFI. O), which in turn relies on Whole Foods for about a third of its sales. United Natural’s shares tumbled 8.2 percent to close at $39.47.

FULL-BLOWN PROXY FIGHT Jana, founded by Barry Rosenstein in 2001, oversees $6 billion and has engaged with companies dozens of times. Only once, in the case of Agrium Inc (AGU. TO), has it entered into a full-blown proxy contest. In its filing, the hedge fund said it wanted to boost Whole Foods’ undervalued shares by discussing issues like optimizing its real estate and capital allocation strategies as well as its management analytics and digital capabilities. Whole Foods has been losing shoppers to rivals as the natural and organic category that it pioneered has gone mainstream via grocery rivals ranging from Kroger Co (KR. N) and Wal-Mart Stores Inc (WMT. N) to newer competitors such as Inc (AMZN. O) and meal kit provider Blue Apron.

Late last year, Whole Foods returned co-founder John Mackey to the role of solo chief executive after six years of splitting the job with co-CEO Walter Robb, who focused on operations, betting that Mackey would be best to lead a turnaround. Mackey is an outspoken libertarian with a knack for capitalizing on nascent food trends, but he also has courted controversy. For years before the company’s purchase of organic food producer Wild Oats, Mackey used the alias “Rahodeb,” an anagram of his wife’s name, to post comments on web forums praising Whole Foods and criticizing Wild Oats. Jana announced its plans to push for change long before the company’s annual meeting which is not expected to occur until early next year. Whole Foods in February cut its full-year sales and profit forecasts after posting its sixth straight quarter of same-store sales declines. In addition to closing stores and centralizing its business, Whole Foods now is working with Dunnhumby, a consumer data subsidiary of Tesco Plc, in a bid to catch up with Kroger and other rivals that already use such information to improve merchandising and personalize offers to loyal customers.

A customer exits a Whole Foods Market in New York City, U.S., February 7, 2017.

REUTERS/Brendan McDermid

BHP rebuffs Elliott’s reform plan, says costs outweigh gains SYDNEY/LONDON BHP Billiton on Monday rejected a plan by activist shareholder Elliott Advisors to scrap the miner’s dual company structure, split off its oil business and return more cash to investors, saying the costs would outweigh any benefits.

AT&T bets on 5G with Straight Path Communications buy for $1.25 billion AT&T Inc said on Monday it would buy Straight Path Communications Inc , a holder of licenses to wireless spectrum, for $1.25 billion in an all-stock deal as it aims to accumulate the airwaves it needs for a next generation network.

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Data analytics firm Qlik Technologies is in the market with a $1.07 billion loan refinancing that is expected to halve the interest margin on a highly leveraged loan that it raised from direct lenders less than a year ago to finance its $3 billion sale to private equity firm Thoma Bravo. Thoma Bravo financed the take private acquisition with a record $1.075 billion unitranche loan that was provided by a group of alternative capital providers led by business development company Ares Capital Corp in mid 2016 after traditional bank lenders were unable to match the debt or leverage on offer. Qlik is one of a host of highly leveraged US companies that are taking advantage of white hot demand from institutional loan buyers desperate for higher yields and floating rate assets in a rising interest rate environment to refinance existing loans. Issuers booked a record US$261bn in opportunistic refinancings in the first three months of 2017, pushing average first-lien institutional term loan spreads to 343bp, excluding Libor floors or Original Issue Discounts, according to LPC data.“I would say that demand seems very strong right now. It’s certainly a reason why Qlik can price a deal,” a banking source said. Alternative lenders have been picking up business from traditional banks since 2013, when federal regulators introduced leveraged lending guidelines to curb leverage and restrict capital to reduce systemic risk in the banking sector.  This time, Qlik has turned to traditional banks Morgan Stanley and Goldman Sachs to lead its new loan. The two leads are selling the deal on the back of the company’s improved performance and reduced leverage, which at less than 5.0 times total debt-to-Ebitda is now in line with the guidelines requiring extra scrutiny when leverage exceeds 6.0 times.“Fast forward and the company has recognized nearly all of the cost cuts that were projected, and at the same time Ebitda has grown very nicely,” the banking source said.

BIG SAVINGS The refinancing swaps Qlik’s unitranche loan for a single first-lien term loan B. The deal is helping the company to cut nearly 500bp off the spread, which will save about $50 million in interest expense, according to Moody’s Investors Service. Unitranche loans are typically seen on small to mid-sized buyouts and are popular with investors for high yields and private equity firms for ease of execution and certainty of funding in volatile or capital constrained markets. The loans offer senior and subordinated debt in one instrument with a blended cost of capital and average yields of 8-9%. Moody’s gave the new deal B3 corporate family and first-lien facility ratings and expects the company to generate 2017 revenues of approximately $785 million with average annual sales growth of more than 10% in the next two years.

The spread on the US$75m revolver and the $995 million term loan is guided at a range of 350bp-375bp over Libor, down from 825bp over Libor on the unitranche loan. The term loan has a 1% Libor floor and is offered at a discount of 99-99.5. BACK STORY Traditional banks subject to US leveraged lending guidelines and tough regulatory capital requirements were unable to lend to Qlik’s original deal in June 2016 given the amount of debt required, several banking sources said. Alternative lenders not subject to leveraged lending guidelines took big losses on deals that failed to syndicate in the fourth quarter of 2015, which reduced balance sheet capacity and they pulled back from lending.

Although a syndicated deal was available, the unitranche loan offered certainty of close and pricing that the syndicated loan was unable to guarantee, a second banker said. At US$1.075bn, the deal was too large for any single direct lender and Qlik assembled a group of about 10 lenders after going out to more than 20, the banking source said. Ares Capital led the deal, which was one of the biggest-ever provided by a business development company, together with joint arrangers Golub Capital, TPG’s credit specialist TSSP and Varagon Capital Partners. Unitranche loans typically carry higher prepayment penalties. Qlik’s original unitranche loan has a premium of 105 cents on the dollar if the loan is repaid, which the company will have to pay to do the current refinancing. The new loan has call protection of 101 for six months. If Qlik completes its proposed refinancing, three holders of the loan, ARCC, TSLX and GBDC – business development companies managed by Ares Capital, Golub Capital and TSSP, respectively – should be fully repaid, according to a Wells Fargo equity research note. Qlik’s cost saving will cover the cost of paying the call protection in just over a year, the first banking source said.

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