Monday Morning Reads
- ‘Whatever It Takes’ Moment
- Stock Market Rout
- Trump-Powell Battle
- Just Backfired
- The Hit To Berkshire Hathaway’s Book Value
- Forget Facebook
- The Year on Wall Street
- Expectation vs. Reality
- What is Your Course for Uncharted Waters?
- Futures give up overnight gains
- Vista will acquire Mindbody for $1.9B
- 'Aquaman' dominates pre-Christmas weekend box office with $72M debut
- Oil dives to new lows
- Judge Leon taking heat over CVS-Aetna deal
- Wedbush removes Facebook from Best Ideas
- Exxon oil exploration ship offshore Guyana chased away by Venezuelan navy
- Judge accepts CVS changes for Aetna buy
- Kraft, Mondelez make cut for Campbell Soup auction
- 'Plunge protection team' hard at work
- China to lower tariffs on more products
- Ant Financial in £500M talks for WorldFirst
Following the worst week for equities since the financial crisis, U.S. stock index futures are getting a little merry in thin Christmas Eve trading. Treasury Secretary Steven Mnuchin held calls on Sunday with the heads of the six largest U.S. banks in order to ensure liquidity and made plans to convene the "Plunge Protection Team." The group, which also met in 2009 during the latter stage of the financial crisis, includes officials from the Fed and SEC.
White House advisers of President Trump are further discussing arranging a meeting between him and Fed Chairman Jay Powell in the coming weeks, sources told WSJ. Bloomberg reported on Saturday that Trump had privately discussed the possibility of sacking Powell, although Treasury Secretary Steven Mnuchin later shot down the rumor, saying he had "never suggested a firing."
Cooling trade tensions? Starting Jan. 1, China plans to remove import and export duties on a range of goods, including zero tariffs on ingredients for livestock feeds and certain medicines. The nation will also cancel tariffs on four types of solid waste such as manganese slag and lithium ion cells for new-energy vehicles, while lowering provisional tariff rates on aircraft engines, robots and other advanced equipment.
Looking to address a complaint at the heart of the Sino-U.S. trade dispute, China is also considering a new law on foreign investment that would emphasize the illegality of forced tech transfer. The measure could replace three existing rules regarding wholly foreign-owned enterprises, Chinese-foreign equity joint ventures and contractual joint ventures, which often go on to compete with foreign investors through their parent companies.
Negotiations to reopen the federal government made little headway Saturday, and the Senate adjourned until Thursday, leaving the government likely to remain partially shut for most of the week. As the standoff deepened over security funding, House GOP leaders also said they anticipated no votes before Dec. 27. "The crisis of illegal activity at our Southern Border is real and will not stop until we build a great Steel Barrier or Wall. Let work begin!" President Trump wrote on Twitter.
India's rise on the global stage has claimed another victory after its stock market overtook Germany to become the seventh largest in the world. That means, after the U.K. leaves the EU in March, the bloc would have only one country - France - among the seven biggest markets. While the MSCI Emerging Markets Index (ETF: EEM) is heading for a 17% decline this year, India’s benchmark S&P BSE Sensex is up 5%.
OPEC hasn't even started implementing its new six-month agreement to trim output by 1.2M barrels per day, but the group is already prepared to lengthen or deepen the cuts. "If we are required to extend for another six months, we will, if it requires more, we always discuss and come up with the right balance," OPEC President Suhail Al Mazrouei declared. Oil plunged over 11% last week to $45/bbl, capping its biggest weekly decline since 2016.
Marking its first national security space mission for the U.S. military, a SpaceX (SPACE) rocket carrying a $500M GPS satellite built by Lockheed Martin (NYSE:LMT) blasted off from Florida's Cape Canaveral on Sunday. The successful Falcon 9 launch is a significant victory for the privately held space company, which has spent years trying to break into the military space launch market dominated by United Launch Alliance, a partnership between Boeing (NYSE:BA) and Lockheed.
Brazilian Federal Judge Therezinha Cazerta has overturned a decision that put the brakes on Embraer's (NYSE:ERJ) proposed sale of 80% of its commercial aviation division to Boeing (BA), as the judicial back and forth surrounding the deal continues. Her decision came in response to a request from Brazil’s solicitor general, known as the AGU, which argued that the injunction would hurt the economy and represented government overreach into the free market.
How much has Dieselgate cost Volkswagen? The cleanup will amount to €5.5B in 2018, around €2B in 2019 and €1B in 2020, VW (OTCPK:VWAGY) CFO Frank Witter told Boersen-Zeitung. Since 2015, the German group has paid more than €27B to settle investor and consumer lawsuits, as well as regulatory fines and remedies tied to resolving the scandal over excessive emissions levels.
South Korea is fining BMW $10M over its handling of a spate of 52 engine fires in the country. The problems don't end there. The Ministry of Land, Infrastructure and Transport is referring the case to prosecutors to decide whether criminal charges are necessary. An investigative panel previously found that BMW (OTCPK:BMWYY) tried to hide the issue and then took too long to recall the 172K affected vehicles.
Carlos Ghosn can be held without possibility of bail for an additional 10 days, a Tokyo court ruled Sunday, ensuring the former Nissan (OTCPK:NSANY) chairman will spend Christmas behind bars. Ghosn was re-arrested based on suspicions that around October 2008 he shifted personal trades to Nissan to make it responsible for ¥1.85B ($16.6M) in personal investment losses. He's been held at Tokyo's detention house since Nov. 19.
It's the third time in the past two months Tesla (NASDAQ:TSLA) has adjusted its car costs in China. Model 3 prices have been slashed by up to 7.6% to 499,000 yuan ($72,000) after China’s finance ministry said it would suspend additional tariffs on U.S.-made vehicles and auto parts. Separately, CEO Elon Musk said Tesla will reimburse customers if delays to U.S. car deliveries caused them to miss out on significant tax credits.
Joining private equity firms Bain Capital, KKR and FinTrek, U.S. food companies Kraft Heinz (NASDAQ:KHC) and Mondelez (NASDAQ:MDLZ) have been shortlisted to participate in the second round of Campbell Soup's (NYSE:CPB) auction of its international business. According to Reuters, Campbell could fetch close to $3B for the division, which includes its Australian cookie brand Arnott’s and Danish baked snacks maker Kelsen Group.
As part of its drive to diversify from share trading, Euronext (OTCPK:EUXTF) is aiming to buy the owner of the Oslo stock exchange for €625M. Earlier this year, it moved into foreign exchange by purchasing the Irish Stock Exchange. Euronext, which also operates bourses in Paris, Amsterdam, Brussels, London and Lisbon, was particularly attracted to Oslo Bors' (OTC:OSBHF) position in seafood derivatives, as well as oil services and shipping.
In Asia, Japan closed. Hong Kong closed. China +0.4%. India -0.8%.
In Europe, at midday, London -0.5%. Paris -1.1%. Frankfurt closed.
Futures at 6:20, Dow +0.4%. S&P +0.6%. Nasdaq +0.8%. Crude -0.3% to $45.44. Gold +0.5% to $1264.60. Bitcoin +1% to $4125.
Ten-year Treasury Yield flat at 2.78%
Today's Economic Calendar
8:30 Chicago Fed National Activity Index
NYSE Close at 1:00 P.M.
SIFMA Close at 2:00 P.M