Asian stock markets slightly up in the superweek start

The Asian stock markets started this superweek with causious actions. The stock markets were slightly up and for example the Hang Seng index was up 0,3 % in Hong Kong, Shanghai Composite 0,1 % and Nikkei 0,35% in Tokyo. The yen was trading at 108,63 dollars and euro 1,1054 dollars.

This week will be a superweek due to several central banks rate decisions, UK´s Brexit vote and for example the trading start of the Saudi Aramco oil company.

According to the morning Financial Times, China has ordered all government offices and public institutions to remove foreign computers and software within three years. According to the news the aim of the directive is to switch to domestic technology vendors and increase the domestic home-made technologies in the markets.

In the trade policies this is seen as an action against the US Administration to ban the US companies to deal with Chinese telecom company Huawei.

The US and China are expected to reach a Phase 1 trade deal by the end of this year. On the other hand the US new tariffs in the China trade will come into force on Sunday, the 15th December, if no new deal is reached. The recent exports/imports data between the countries show that the trade has been slowing in China exports in November.

Business Finance

Superweek in the financial markets next week

Next week will be a superweek for the financial markets globally. There will be more information about the UK Brexit elections, the trade deal tariffs with US China will come into force if no new deal is agreed and there are several central banks meetings regarding the interest rates.

The US Federal Reserve will start its FOMC meeting on Tuesday the 10th December and the rate decision is expected on Wednesday the 11th December in press conference. The last Friday data of US payrolls was better than expected and the estimate is that Fed will not make any changes in its last meeting this year. So Fed rates are expected to be unchanged. The press meeting will start at 2.0 pm local time.

On Wednesday the 11th December, the debut of the Saudi oil company Aramco´s trading will start on the Saudi Stock Exchange. The IPO price was 32 riyals and the company was valued at 1,7 trillion dollars making it the world largest IPO ever.

On Thursday the 12th December the UK will vote in the general elections regarding the Brexit. According to several polls the Tories are leading the race. According to Telegraph newspaper,  the PM Boris Johnson’s lead over Labour has stabilised at 10 points, although the Labour Jeremy Corbyn has slowly started to narrow the gap.

On Thursday there will be also the European Central Bank´s Governing Council meeting in Frankfurt. The expectations of rate cut are not high due to the lates economic data and the widely concerns related to subzero rates. The Russian Central Bank is having a rate meeting on Friday the 13th with the expectation of interest rate cut.

The Bank fo England and the Japan Central Bank are holding their interest rates meeting on the following week, on the Thursday 19th December. Well behind the UK elections and the US China trade situation.

On Sunday the 15th December the US will raise the tariffs in China trade if no new deal is reached before that. The countries have been discussing about the Phase 1 deal during the autumn time and it was widely expected that the deal would be done by the end of this year.  The US support to the democratic movement in Hong Kong has delayed the negotiations.

On the other hand the latest data from China shows that the China exports dropped 1,1% in November and the exports to US declined 23 %. This might indicate that the countries, on both sides, are willing to make the deal before the year end.

 

 

 

 

Business Finance Tech

Fed is expected to keep the rates unchanged in Dec

The US Federal Reserve, Fed is expected to keep the federal funds rate unchanged in its next meeting on the 11th Dec. According to Bloomberg, the market expects the fed funds target range to be the same ,1,5 % to 1,75 %.

The reason for this new estimate is the better than expected payroll information from November. According to the data, the payrolls jumped to 266000 while the market estimate was 180000 jobs. The jobless rate also dipped to 3,5 %.

For the next year, the rate cut is expected to be smaller than before and for example the fed funds futures for January 2021 is showing 1,32%. This would mean about 0,23 % decrease from the levels now.

Business Finance

Saudi Aramco to be the world biggest IPO

The Saudi Aramco listing is the world biggest IPO. The company sold 1,5 % of its shares with the price of 32 riyals,  at the top range, mostly to domestic and Gulf region investors. The valuation of the company was 1,7 trillion dollars and the share offering was 4,6 times oversubscribed.

The trading of the shares will start next week in Riyadh in the Saudi Stock Exchange. There are also some estimates that Aramco will continue the selling of its shares rather sooner than later and many global investors are waiting that the new company will be included in the global indexes.

 

Business Finance

Moncler Ruffini: There are no concrete talks at the moment

The owner of the Italian fashion house Moncler´s Mr Remo Ruffini said today that the company is not having any concrete takeover talks. He was referring to the news that the French luxury house Kering (KER) would be in talks to buy Moncler.

– In relation to the rumors reported by certain media, Mr. Remo Ruffini – in his capacity as shareholder of Moncler – would like to clarify that from time to time he maintains contacts and interacts with investors and other sector participants, including the Kering group, in order to explore strategic potential opportunities to further promote the successful development of Moncler. At the moment, however, there is not any concrete hypothesis under consideration, the company release stated later today.

Moncler´s (MONC) shares were slightly down from the highs and were trading up 7,03% to 41,56 euros in Milan on Thursday. The shares hit up over 10 % during the day after the possible takeover news. The French luxury house Kering´s (KER) stock was trading up 0,41 % to 540,30 euros in Paris.

 

 

Business Finance Lifestyle

Tiffany Q3: Global net sales unchanged vs year ago

The US jewellery company Tiffany & Co. (NYSE: TIF) today reported its financial results for the three months and nine months ended October 31, 2019. Worldwide net sales for the third quarter were unchanged from the prior year and decreased 2% in the year-to-date period, the company said.

-On a constant-exchange-rate basis, which excludes the effect of translating foreign-currency-denominated sales into U.S. dollars (see “Non-GAAP Measures”), worldwide net sales for the third quarter were 1% above the prior year and unchanged in the year-to-date period. Net earnings declined in both periods, reflecting lower operating margins, a higher effective income tax rate for the third quarter and a slightly lower effective income tax rate in the year-to-date period, in each case, as compared to the prior year, the press release stated.

-Our underlying business remains healthy with sales attributed to local customers on a global basis growing in the third quarter, led by strong double-digit growth in the Chinese Mainland offset in part by softness in domestic sales in the Americas, the CEO Alessandro Bogliolo said,

-We are very excited about the recently announced transaction with LVMH and, pending the required approvals, look forward to becoming part of the LVMH family of exceptional luxury brands, he said.

Lifestyle Finance Business

Moncler stock over 10 % rise in Milan – takeover talks with Kering – Bloomberg

The Italian fashion house Moncler´s (MONC) stock is over 10 % rise in the Milan Stock Exchange today due to the possible takeover by the French luxury group Kering (KER). Bloomberg News was the fist media to publish about the takeover talks between the companies. Moncler´s stock was trading at 43,05 euros, up 10,87%.

According to the news, the companies are in talks of the potential deal of the Italian skiwear maker, Moncler although there is no certainty that the deal would be made. It is expected that the Tiffany takeover of the LVMH Group has been one of the drivers for the French Kering Group to expand as well.

Kering´s (KER) stock was trading up 1,12 % at 544,10 euros. The rival company LVMH was trading also up 0,98 % at 399,90 euros in Paris Stock Exchange.

The Kering House include brands like Gucci, Yves Saint Laurent, Puma and Boucheron and its market cap is 67,9 billion euros compared to Moncler´s 10 billion euros.

Business Finance