July 6th, 2017
Daily Market Commentary
- Canadian stocks rose for the first time in three trading days as gains in financials and gold stocks offset a rout in oil prices. The S&P/TSX Composite Index added 23 points or 0.2 percent to 15,153.12. Materials shares gained 0.8 percent as gold prices rebounded from Tuesday’s decline. Financials rose 0.7 percent as investors saw a hawkish tone in the latest meeting minutes from the U.S. Federal Reserve.
- The Canadian dollar’s world-beating rally is losing steam, according to the currency’s most accurate forecasters. The loonie has gained 4.1 percent against the greenback over the past month, to C$1.2957, beating all 31 major global currencies tracked by Bloomberg after policy makers signaled they may raise interest rates for the first time since 2010.
- The head of Sandstorm Gold Ltd. is feeling misunderstood. Shares in the Vancouver-based royalty and streaming company haven’t done much since it announced a deal in April to acquire Australia’s Mariana Resources Ltd. The complexity of the arrangement — in which Sandstorm will obtain a 30 percent interest in the Hot Maden gold-copper project in Turkey — has been an issue for investors.
- Vancouver is set to introduce new restrictions on Airbnb Inc., Expedia Inc.’s HomeAway unit and other short-term rental operators as Canada’s priciest housing market seeks to ease its near-zero supply of homes to let.
- European stocks dropped with bonds as the yield on the region’s benchmark debt climbed to its highest level in 17 months. The Stoxx Europe 600 Index fell 0.6 percent as of 10:52 a.m. in London. The yield on German 10-year bunds rose 0.07 percentage point to 0.53 percent, the highest level since January 2016. Bonds across Europe dropped after the results of a French debt auction were published, which showed lower demand for French 30-year debt.
- U.S. index futures tracked European stocks lower, signaling a loss for the S&P 500 for the first time in four days. S&P 500 contracts expiring in September dropped 0.4 percent as of 6:09 a.m. in New York, with the underlying gauge at a one-week high. Shares in Europe fell with bonds after a French debt auction showed softer demand.
- Most Asian equities retreated as energy shares fell and investors absorbed details of the U.S. Federal Reserve’s most recent meeting. The MSCI AC Asia Pacific Index lost 0.2 percent as of 4:35 p.m. in Hong Kong, swinging between losses and gains earlier. The benchmark Asian stocks gauge has declined 0.4 percent this week.
- Oil rebounded from the biggest daily loss in four weeks as industry data showed U.S. crude and gasoline stockpiles declined. Futures climbed as much as 1.7 percent in New York, paring Wednesday’s 4.1 percent loss. Crude and gasoline inventories both dropped by more than by 5.5 million barrels last week, the American Petroleum Institute was said to report. Government data Thursday is also forecast to show supplies fell.
- Gold holds gains after minutes from U.S. Federal Reserve’s most recent meeting showed a lack of consensus about when to shrink its balance sheet and how to approach policy strategy at a time of low inflation.
- European Union Brexit negotiator Michel Barnier signaled that even a partial withdrawal from the bloc will have consequences on the U.K.’s ability to interact with the EU and that a “frictionless” trade relationship isn’t feasible. A month into formal talks over the split, Barnier used an address to an EU committee in Brussels to tell Britain that any type of breakup will carry costs, delivering a blow to members of Theresa May’s government who are distancing themselves from her initial hardline stance and seeking to retain close links.
- Bain Capital and Cinven are set to approach Stada Arzneimittel AG management with a renewed 5.3 billion-euro ($6 billion) offer for the drugmaker on Thursday after some of the largest investors committed to tendering their stake, people familiar with the matter said.
- The European Union and Japan overcame their differences on farm and car exports, paving the way for a free-trade agreement between two partners that make up more than a quarter of the world’s economic output. “We’ve reached political agreement” on an EU-Japan trade deal at the ministerial level, EU Trade Commissioner Cecilia Malmstrom said on Twitter on Wednesday. “We now recommend to leaders to confirm this at summit.”
- Banco Santander SA is seeking about 5 billion euros ($5.7 billion) for a majority stake in about 30 billion euros of real estate loans and assets it inherited when it bought Banco Popular Espanol SA last month, according to three people with knowledge of the matter.
- When Chinese President Xi Jinping sits down with Donald Trump in Hamburg this week, he’ll confront a growing rift on how to rein in North Korea. Xi’s solution might be to put the onus back on the U.S. The meeting on the sidelines of the Group of 20 summit comes amid the U.S. president’s growing displeasure at what he sees as a lack of Chinese pressure on its ally, especially after Kim Jong Un announced his first test of a missile capable of reaching Alaska.
- Manhattan homebuyers found deals they couldn’t refuse in the second quarter, driving up sales of previously owned properties by the most in more than two years. Purchases of resale homes jumped 16 percent from a year earlier to 2,597, according to a report Thursday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate.
- Axis Capital Holdings Ltd. agreed to buy Novae Group Plc for $604 million in cash to expand insurance offerings in the Lloyd’s of London market. Axis will pay 700 pence per share, about 20 percent more than Wednesday’s closing price, the London-based seller said in a statement.
- Caesars Entertainment Corp. hired two executives to help expand beyond gambling, including licensing the Caesars and Harrah’s brands to hotels that may not feature casinos. As Caesars’ biggest division emerges from bankruptcy protection, a number of potential investors have expressed interest in building resorts flying the company’s flags, in the U.S. and abroad, Chief Executive Officer Mark Frissora said in an interview.
- U.S. strategic crude stockpiles have dropped to the lowest level in more than 12 years as the shale boom reduces the nation’s need for an emergency buffer against shortages. Inventories declined by about 13 million barrels over 17 consecutive weeks as the Energy Department delivered supplies it sold in recent months.
- Deutsche Bank AG is preparing to move large parts of the trading and investment-banking assets it currently books in London to its hometown of Frankfurt in response to Britain’s exit from the European Union, people familiar with the matter said.
- Qatar Airways Ltd. joined other major carriers in the Middle East in securing exemption from measures barring the use of laptops and other large electronic devices in the cabins of U.S.-bound aircraft.
- Electric cars will outsell fossil-fuel powered vehicles within two decades as battery prices plunge, turning the global auto industry upside down and signaling economic turmoil for oil-exporting countries. The Bloomberg New Energy Finance forecast says adoption of emission-free vehicles will happen more quickly than previously estimated because the cost of building cars is falling so fast.
- It sounds messy, but Baskin-Robbins says it can do it — deliver ice cream in the heat of summer to customers’ front doors. More than 600 Baskin-Robbins U.S. stores are now delivering scoops of ice cream, milkshakes, sundaes and cakes through DoorDash Inc. The chain, owned by Dunkin’ Brands Group Inc., had previously tested the service in about 60 locations in Los Angeles and Chicago.
- Since the 1990s, Norwegian metals refiner Elkem AS routinely tapped the world’s oldest power exchange in search of the best deals on the electricity supplies it needed to run five plants that make materials for everything from iPhones to body armor to solar panels. Not anymore. Elkem, Norway’s third-largest electricity buyer, has joined a growing list of energy players to quit the Nasdaq Inc. exchange that offers power contracts in the Nordic region and Germany.
- General Electric Co., Merck KGaA, Sigma-Aldrich Corp. andCanon Inc. risk fines for breaching European Union merger rules after regulators sent them antitrust complaints, months after the EU fined Facebook $125 million for giving misleading information during a deal review.
- Japan’s Konica Minolta Inc. and a government-backed investment fund agreed to buy closely held Ambry Genetics Corp. for $800 million, gaining control of a U.S.-based genetic-testing technology provider.
*All sources from Bloomberg unless otherwise specified