October 2nd, 2017
Daily Market Commentary
- Canadian stocks posted their biggest monthly gain since July 2016, rising 2.8 percent in September as energy shares rebounded along with the price of oil. The S&P/TSX Composite Index added 17 points Friday or 0.1 percent to 15,634.94, the highest close since early May.
- Canadian grocer Metro Inc. agreed to buy pharmacy chain Jean Coutu Group Inc. for C$4.5 billion ($3.6 billion) to diversify its business in an industry under increasing threat from Amazon.com Inc. Metro is offering C$24.50 a share in cash and stock for Jean Coutu, the companies said Monday in a statement. That’s 15 percent more than Jean Coutu’s 20-day average price prior to an Aug. 21 letter of intent between the retailers, they said.
- Ontario is about to become a test case for a debate that’s divided economists and politicians for decades: whether a higher minimum wage will really boost living standards for the most vulnerable workers or hurt them by forcing employers to cut jobs. The government of Canada’s most populous province plans to increase the minimum wage 32 percent to C$15 ($12) an hour by the end of 2018.
- European stocks rise, boosted by a weaker euro, while Spanish equities fall the most in nearly two weeks after a contentious weekend vote for independence in Catalonia. The Stoxx Europe 600 Index climbs 0.3%. Spain’s IBEX 35 is down 1.2%, with banks leading declines, as separatist leaders in Catalonia indicate they may declare independence as early as this week after a referendum that saw hundreds injured.
- The dollar rose with Treasury yields as investors contemplated the prospects for U.S. tax cuts as well as the chances of a new — and potentially less dovish — Federal Reserve chief.
- Asian stocks were mixed as China, Hong Kong, India and South Korean markets closed for public holidays. The MSCI Asia Pacific Index fell 0.1 percent to 161.07 as of 4:24 p.m. in Hong Kong. BHP Billiton Ltd. and miners gained after China reported better-than-expected manufacturing activity. Nissan Motor Co. slumped after suspending car registrations in Japan.
- Oil slid in New York after its biggest monthly gain in more than a year as the boost from seasonal demand and political tensions in Iraq was expected to fade. West Texas Intermediate futures slipped 0.4 percent. Prices reached a five-month high near $53 a barrel last week on concerns an independence referendum in Iraq’s Kurdish region might lead to a disruption in oil exports.
- Gold declines to lowest level in more than six weeks as dollar strengthens, U.S. stocks hit records after Trump administration takes steps toward tax reform.
- Global Logistic Properties Ltd., a Singapore-based owner of warehouses, said it will pay $2.8 billion to a fund affiliated with Brookfield Asset Management Inc. to purchase a developer of logistics properties in Europe. The acquisition of Gazeley will give GLP an additional 32 million square feet of space across four countries, according to a filing to the Singapore stock exchange on Monday.
- Bain Capital LP offered to pay as much as $1.3 billion for Japan’s third-largest advertising agency Asatsu-DK Inc. with the aim of delisting the business and improving its profitability.
- Nissan Motor Co. will recall about 1.2 million vehicles made in Japan after regulators discovered that uncertified personnel at the automaker had conducted quality checks. Chief Executive Officer Hiroto Saikawa told reporters on Monday that he’ll personally investigate the issue and find out the cause before deciding who should bear responsibility for the “shocking” lapse.
- The mass shooting in Las Vegas will refocus attention on the political stalemate over gun control laws, thrusting U.S. President Donald Trump into a fresh test of his leadership. At least 50 people were killed and more than 200 injured in the attack by a solo gunman at an outdoor country-music concert on the Vegas strip, police said. That toll makes it the deadliest mass shooting in modern U.S. history.
- Here’s some information that Equifax Inc. is managing to hold onto: payroll data from 7,100 companies. Inside the U.S. credit-reporting firm is a warehouse of corporate secrets like none other — a database tracking the careers and earnings of bankers, technology workers and other personnel across the country.
- Walt Disney Co. and cable provider Altice USA Inc. reached a preliminary programming agreement that will enable 2.4 million New York-area pay-TV subscribers to continue to get ABC, ESPN and the Disney Channel. The two sides “have extended the deadline accordingly to try and finalize the terms,” according to a joint email on Sunday. No details were included in the statement. The preliminary terms were struck at the last minute, as Disney was about to cut off broadcasting to Altice subscribers Sunday night.
- A year after Apple Inc. was ordered to pay an eye-watering 13 billion euros ($15.3 billion) in back taxes, ending sweetheart deals is back at the top of the European Union’s “to do” list. The same team is poised to rule on one of the cases against Amazon.com Inc.and McDonald’s Corp. in the coming weeks, according to three people familiar with the cases who spoke on condition of anonymity.
- U.K. Prime Minister Theresa May heads into the Conservative Party conference fielding questions over why she hasn’t fired Foreign SecretaryBoris Johnson, who’s set out an independent course on Brexit and further undermined her authority.
- Reliance Communications Ltd.’s plan to merge with Aircel Ltd. collapsed in a blow to the Indian mobile phone carriers’ plans to pare debt and gain scale to take on bigger rivals.
- Greenko has sought to acquire the Mumbai electricity business of Anil Ambani-led Reliance Infrastructure for an enterprise value of 130b rupees ($1.99b) to 140b rupees.
- On the last page of a nine-page tax plan that calls for slashing business rates, President Donald Trump and congressional Republicans proposed a little-noticed, brand-new tax that may hit companies like Apple Inc. and Pfizer Inc. It’s contained in one sentence: “To prevent companies from shifting profits to tax havens, the framework includes rules to protect the U.S. tax base by taxing at a reduced rate and on a global basis the foreign profits of U.S. multinational corporations.”
- Here are two facts that defy logic: By the end of the year, electric-car maker Tesla Inc. will have burned through more than $10 billion without ever having made 10 cents. Yet companies around the world are lining up to compete with it. Almost 50 new pure electric-car models will come to market globally between now and 2022, including vehicles from Daimler AG and Volkswagen AG.
- Uber Technologies Inc. directors plan to vote Tuesday on board reforms and whether to pursue a major stock deal with SoftBank Group Corp. despite the surprise appointment of two new members by ousted Chief Executive Officer Travis Kalanick, two people familiar with the matter said.
- Prysmian SpA, the world’s largest cable maker, is among companies exploring a bid for General Cable Corp. of the U.S., according to people with knowledge of the matter, in a deal that would allow the Italian manufacturer to boost its market share amid consolidation.
- Noble Group Ltd., the commodity trading house that’sbattling for survival, struck a deal with Mercuria Energy Group Ltd. to tap about $400 million of financing for its Asian coal and iron ore business, according to people familiar with the matter.
- Global construction materials maker CRH Plc is nearing an agreement to acquire Florida-based cement company Suwannee American Cement LLC from Votorantim Cimentos SA and Anderson Columbia Co. to drive further growth in the U.S., according to people familiar with the matter. The deal may value Suwannee at about $750 million.
*All sources from Bloomberg unless otherwise specified