Global Markets
The decline in US stocks on Wall Street futures came amidst anticipation among investors for upcoming economic data and remarks from Federal Reserve Chair Jerome Powell. This followed robust readings on the U.S. economy, which tempered expectations for interest rate cuts this year. Additionally, concerns arose over potential disruptions to the crucial chip-making industry in Taiwan following a powerful earthquake in the region.
In Europe, stocks remained relatively stable as traders evaluated data on euro zone inflation. However, Japan’s Nikkei index closed 1% lower, primarily influenced by a decline in heavyweight Fast Retailing. Similarly, Canada’s main stock index experienced a downturn.
Gold prices paused their upward trajectory after reaching record highs, while the U.S. dollar saw marginal movement. On the other hand, oil prices advanced due to escalating supply risks resulting from ongoing Ukrainian attacks on Russian refineries. Furthermore, there were concerns about the potential widening of the conflict in the Middle East, contributing to the rise in oil prices.
Corporate News
- AstraZeneca Plc, GSK Plc & Teva Pharmaceutical Industries Ltd: U.S. President Joe Biden is set to host a White House event with U.S. Senator Bernie Sanders to highlight efforts to reduce the cost of inhalers for asthma sufferers. The event focuses on criticism toward four manufacturers of inhalers in the U.S., including AstraZeneca, Boehringer, Teva Pharmaceuticals, and GSK, over higher prices compared to other countries. The Biden administration aims to increase competition and lower inhaler costs by addressing falsely claimed patents.
- BlackRock Inc & KKR & Co Inc: Abu Dhabi alternative investor Lunate acquired a 40% stake in Abu Dhabi National Oil Company’s oil pipeline infrastructure assets from BlackRock and KKR. This acquisition was made through one of Lunate’s funds, involving the purchase of a special purpose vehicle jointly held by the two companies’ managed funds. The terms and value of the deal were not disclosed.
- Boeing Co & Caterpillar Inc: Outgoing Boeing CEO Dave Calhoun will not seek re-election to the board of Caterpillar at the company’s 2024 annual shareholders meeting. This decision was not due to any disagreement between Calhoun and Caterpillar. Calhoun’s departure from Boeing comes as the company faces regulatory challenges, notably after a mid-flight panel blowout on a 737 MAX 9 plane in January.
- BP Plc: Two major shareholder advisory firms expressed support for BP’s board handling of former CEO Bernard Looney’s dismissal. Looney stepped down last September and was formally dismissed in December after the board concluded he had knowingly misled it. Shareholder advisory Glass Lewis stated satisfaction with the handling of Looney’s departure ahead of BP’s annual general meeting.
- Cal-Maine Foods Inc: Migratory waterfowl are implicated in the avian-flu outbreaks affecting Texas cows and poultry. The U.S. government has reported cases of the disease in Texas dairy herds and commercial poultry facilities. Notably, Cal-Maine Foods culled 1.6 million laying hens after a positive test at a Texas egg farm, marking a significant outbreak in the state’s poultry industry.
- Citigroup Inc: The bank urged a federal judge to dismiss a lawsuit by New York Attorney General Letitia James accusing its Citibank unit of failing to reimburse customers who fell victim to online scammers. Citigroup argued that James’ effort to hold it liable under federal law governing electronic fund transfers is misguided and that it has adopted commercially reasonable security measures to verify customer identities.
- HSBC Holdings Plc: Chairman Mark Tucker dismissed the possibility of a spin-off of its Asian business, stating there is no shareholder appetite for such a move. The decision comes after HSBC defeated a resolution last year to potentially spin-off its lucrative Asia business, with the majority of its investor base backing the board’s stance.
- Intel Corp: The chipmaker disclosed deepening operating losses for its foundry business, reporting $7 billion in operating losses for 2023. This represents a steeper loss than the previous year, highlighting challenges as Intel seeks to regain a technology lead lost to Taiwan Semiconductor Manufacturing. Intel anticipates breaking even on an operating basis by around 2027.
- Lockheed Martin Corp: Greece approved the purchase of 35 UH-60M Blackhawk helicopters from the U.S. defense contractor as part of efforts to modernize its armed forces. The deal, worth 1.15 billion euros ($1.24 billion), aims to revamp Greece’s defense industry and boost its shipbuilding sector.
- Microsoft Corp: The U.S. Cyber Safety Review Board faulted Microsoft for cybersecurity lapses in a targeted Chinese hack of top government officials’ emails last year, stating it was “preventable.” The intrusion stemmed from the compromise of a Microsoft engineer’s corporate account and was conducted by a hacking group affiliated with China.
- Novo Nordisk A/S: A Chinese drugmaker developed a biosimilar version of Novo Nordisk’s diabetes drug Ozempic and applied for its approval. The biosimilar, called Jiyoutai, mimics the structure of Ozempic, offering an alternative treatment for patients with type 2 diabetes.
- Vanda Pharmaceuticals Inc: The U.S. FDA approved the company’s drug Fanapt for the treatment of manic and mixed episodes associated with bipolar disorder. This marks the second approval for the drug, which initially received approval for schizophrenia treatment in 2009. The decision could revive prescriptions for Fanapt amid increased competition.
- Vale SA: Indonesia’s mining minister stated that divestment of Vale Canada and Sumitomo Metal Mining’s shares in their nickel miner unit, Vale Indonesia, is expected to conclude in July. The transaction is required for Vale Indonesia to extend its operating permit beyond 2025, with Vale Canada and Sumitomo divesting a 14% stake to Indonesia’s mining industry holding company, MIND ID.
