December, 14th 2016
Daily Market Commentary
What to watch out for:
- Bank of England rate decision Thursday
- Venezuela’s new currency debuts
- The S&P 500 is up about 5 percent in a month, the biggest gain to greet a new president since Ronald Reagan, while the Dow Jones Industrial Average is nearing 20,000.
- Investors added more than $1 billion to exchange-traded funds that buy emerging market stocks and bonds last week after declining in four of the past five weeks. Inflows to U.S.-listed emerging market ETFs that invest across developing nations as well as those that target specific countries totaled $1.03 billion in the week ended Dec. 9.
- European stocks fell after closing at the highest level since January on Tuesday, as investors prepared for the Federal Reserve possibly raising U.S. interest rates for the first time in a year.
- K. employment fell for the first time in more than a year in the three months through October as the labor market showed some signs of weakness.
- European Union banks need to sell hundreds of billions of euros in loss-absorbing liabilities over the next few years to meet the bloc’s rules designed to prevent public bailouts. The European Banking Authority estimates as much as 276 billion euros ($294 billion) of financing is needed under the most stringent assumptions, lowering its earlier forecast.
- Metals: Gold: 1162.86 (+$4.32, +0.37%), Silver: 17.15 (+$0.23, +1.36%); Copper: 2.6080 (+0.36%); Zinc: 1.2397 (+1.04%)
- Energy: Crude: 52.24 (-1.40%); Brent: 54.99 (-1.31%); Nat Gas: 3.45 (-0.69%)
- Exports from the world’s second-largest copper mine in Indonesia are under threat as a government ban on overseas concentrate shipments is scheduled to come into force from the middle of January.
- Quebec’s legislature has passed a bill that will pave the way for more oil and gas exploration, providing a boost to drillers such as Junex Inc. while drawing criticism from environmental, aboriginal and citizen groups.
- Open Text Corporation announced today that it has launched an underwritten public offering of U.S. $500 million of common shares. OpenText intends to use the net proceeds from the Offering to finance a portion of the purchase price for its previously announced acquisition of Dell EMC’s Enterprise Content Division
- Canada got a green light to sell recreational marijuana through a range of retail outlets from an expert panel, whose report boosts the nascent cannabis industry as the country moves toward legalizing the drug.
- Costco Wholesale Corp. is taking its no-frills, bulk-buying strategy to the office and business supplies market, threatening to shake up a retail segment that has already felt the pinch of digital disruption. U.S. retail giant Costco, which has stolen away customers from rivals ranging from food to fashion retailers, is set to launch its first Business Centre store in Canada in a commercial area of Toronto in March after having rolled out about a dozen of the stores south of the border. (Globe and Mail)
- Purdue Pharma LP has struck a deal with Exicure Inc. to buy the rights to an experimental psoriasis treatment for as much as $790 million, the latest in a string of moves to diversify away from the opioid pain drugs that make up the backbone of the company’s business.
- Johnson & Johnson said it ended discussions for a potential deal with Actelion Ltd., narrowing the playing field in the bidding war for the $22 billion Swiss drugmaker, which said it remains in talks with another party.
- 21st Century Fox Inc. and Sky Plc executives are working with their advisers to nail down final terms of an 11.2 billion-pound ($14.1 billion) deal that would consolidate Rupert Murdoch’s television empire across two continents.
- Bill Gates and more than a dozen of the world’s wealthiest individuals revealed a new $1 billion investment fund late Sunday to foster major advances in clean energy production. The goal is to pump money into risky, long-term energy technology that could dramatically reduce greenhouse gas emissions, according to a statement.
- Sony Corp. had its credit rating raised one notch to Baa3 at Moody’s Japan KK, regaining its investment grade at the service for the first time since 2014.
- President-elect Donald Trump tapped Exxon Mobil Corp. chief Rex Tillerson to be the next U.S. secretary of state, according to statement. Tillerson has accepted Trump’s offer, according to a person familiar with the transition. He will reach Exxon’s mandatory retirement age of 65 in March and, if confirmed, would be the first oil executive to lead the State Department.
- Goldman Sachs Group Inc. plans to appoint Harvey Schwartz and David Solomon to succeed President Gary Cohn, who is leaving the bank to take a job in the Trump administration, the Wall Street Journal reported late Tuesday.
- Some of the biggest names in finance are fighting for control of the London gold market — a $5 trillion, three-century-old trading hub that is being forced to adapt to a digital age. As the London Bullion Market Association revamps over-the-counter trades that are the market’s major pricing benchmark, new ways of buying and selling precious metals are set to start next year from CME Group Inc., Intercontinental Exchange Inc. and the London Metal Exchange.
- ANA Holdings Inc. has invested in a new airline venture in Myanmar that aims to start international flights in 2018 as the Japanese carrier seeks to capture demand in Asia’s fastest-growing economy.
- China will raise the sales tax on small cars to 7.5 percent, curbing an incentive that has propped up the auto industry, which is heading for its 26th consecutive annual expansion, according to people familiar with the matter.
- Rosneft PJSC agreed to pay as much as $2.8 billion to buy up to 35 percent of a natural-gas project off Egypt, joining Eni SpA and BP Plc in the largest discovery in the Mediterranean Sea.
- China Life Insurance Co. and State Development & Investment Corp. will pay 22.8 billion yuan ($3.3 billion) for a 50 percent stake in a pipeline unit owned by state energy giant China Petroleum & Chemical Corp.
- Qatar Airways said it’s seeking to renegotiate a $7.8 billion order for Airbus Group SE narrow-body jets and could switch to bigger planes powered by alternative engines as part of a revised agreement.
- China Petroleum & Chemical Corp., the world’s biggest refiner, is weighing a takeover of beleaguered Kurdish oil producer Gulf Keystone Petroleum Ltd., people familiar with the matter said.
- Asahi Group Holdings Ltd. agreed to buy SABMiller Plc’s central and eastern European assets from Anheuser-Busch InBev NV for 7.3 billion euros ($7.8 billion), in a move that catapults Japan’s largest brewer to third place on the continent.
- Billionaire Mikhail Gutseriev agreed to buy control of M.video PJSC, Russia’s largest electronics chain, for as much as $1.3 billion as he expands his investments in the consumer industry.
- China Petroleum & Chemical Corp., the world’s biggest oil refiner, is reviving a long-mooted initial public offering of its retail business that could raise as much as $10 billion
*All sources from Bloomberg unless otherwise specified