Stock Market Update for June 24th, 2024

Prudential

Global Markets

Canadian Stocks Rise on Oil and Gold Gains; Investors Eye Inflation Data and Fed Comments

Canadian stocks saw an uptick today, buoyed by increases in oil and gold prices. The energy sector, a key component of the Canadian stock market, benefited significantly from the rise in crude oil prices. Additionally, higher gold prices provided a boost to mining stocks, adding further positive momentum to the market.

Investors Await Inflation Figures

Investors are closely watching for upcoming inflation data releases from Canada and the U.S. this week. These figures are critical as they provide insight into the economic health and potential future monetary policies in these regions. Alongside the inflation data, comments from U.S. Federal Reserve officials throughout the week are also highly anticipated. These comments could offer clues about the Fed’s future actions regarding interest rates and other economic measures.

U.S. Stock Indexes Mixed

In the U.S., stock indexes displayed mixed performance. Market participants have their eyes on the first U.S. presidential debate, which is expected to impact market sentiment and investor decisions. The debate could offer insights into future economic policies and regulatory changes, influencing investor confidence and market trends.

European Shares Advance

European shares advanced, managing to shrug off initial losses. Gains in the automobile and banking sectors helped lift the market. Investors are also focusing on the upcoming first round of French parliamentary elections later this week, which could have significant implications for the European political and economic landscape.

Asia Market Movements

In Asia, Japan’s Nikkei index closed higher. A weaker yen supported export-related stocks, making Japanese goods more competitive abroad and boosting investor sentiment in the export-driven economy. On the other hand, Chinese equities ended lower as investors remained cautious ahead of key economic data releases at home. The anticipation of this data has made investors wary, leading to a more conservative trading approach.

U.S. Dollar Trading Lower

The U.S. dollar traded lower, reflecting broader market uncertainties and the mixed economic signals. The currency market is reacting to the various economic indicators and potential policy changes that are currently in play.

Overall, global markets are navigating a week filled with significant economic data releases and political events. Investors are closely monitoring these developments to gauge their potential impact on market performance and make informed investment decisions.

Corporate Stock News

Beijing Urges EU to Drop Tariffs on Electric Vehicles

Beijing is pressing the European Union to remove preliminary tariffs on Chinese electric vehicles by July 4, according to a report from China’s state-controlled Global Times. This push comes after both sides agreed to hold new trade talks aimed at easing tensions and fostering cooperation in the automotive sector.

Novo Nordisk’s Wegovy Outperforms in Weight Loss Study

Novo Nordisk’s widely used obesity drug, Wegovy, has shown promising results in a recent analysis, helping women with a common heart disease lose more weight than men with the same condition. The study, published in a medical journal, highlights the potential gender-specific benefits of the drug, which continues to gain popularity in the fight against obesity.

Prudential Announces $2 Billion Share Buyback

Insurance giant Prudential has unveiled plans for a substantial $2 billion share buyback program. The company aims to complete the buyback by mid-2026, reflecting its strong financial position and commitment to returning value to shareholders.

Unifor Workers Strike at Bombardier

Canadian workers’ union Unifor announced a strike involving 1,350 members at Bombardier’s facilities. The strike began after the union and Bombardier failed to reach a tentative agreement before the Saturday deadline. The action highlights ongoing labor tensions and could impact Bombardier’s production and operations.

Paladin Energy to Acquire Fission Uranium for $833 Million

Australian mining company Paladin Energy has agreed to purchase Canada’s Fission Uranium Corp for C$1.14 billion (approximately $833 million). This acquisition will significantly enhance Paladin’s uranium portfolio and strengthen its position in the global nuclear energy market.

Africa Oil Buys BTG’s Stake in Nigerian Joint Venture

Africa Oil has reached an agreement to acquire BTG Pactual Oil & Gas’s 50% stake in their Prime Oil & Gas joint venture. The deal will make BTG a major shareholder in Africa Oil, reinforcing the company’s presence in the Nigerian oil sector.

UPS to Sell Coyote Logistics to RXO for $1.025 Billion

United Parcel Service (UPS) has agreed to sell its Coyote Logistics business unit to RXO for $1.025 billion. The transaction will be financed through a mix of equity and debt, including substantial investments from MFN Partners and Orbis Investments, signaling a strategic move to streamline UPS’s operations.

Sonoco Products Acquires Eviosys for $3.9 Billion

Sonoco Products has announced a $3.9 billion deal to acquire Eviosys, a European food cans manufacturer, from private equity group KPS Capital Partners. Sonoco expects to achieve over $100 million in synergies by integrating Eviosys with its existing metal can business, enhancing its product offerings and market reach.

Alaska Airlines Reaches Tentative Agreement with Flight Attendants

A union representing Alaska Airlines flight attendants has reached a tentative agreement for a record contract with the carrier. The proposed deal will undergo review by union leadership and a member ratification vote, marking a significant step forward in labor negotiations.

Amylyx Pharmaceuticals to Acquire Eiger’s Drug Rights

Amylyx Pharmaceuticals has agreed to purchase the rights to an experimental drug for low blood sugar from the bankrupt Eiger BioPharmaceuticals for $35.1 million. This acquisition represents Amylyx’s entry into metabolic disease drug development, expanding its focus beyond neurodegenerative diseases.

EU Charges Apple with Antitrust Violations

European Union antitrust regulators have accused Apple of breaching the bloc’s tech rules, potentially leading to significant fines. This charge, under the new Digital Markets Act (DMA), aims to curb Big Tech’s power and ensure fair competition. Apple has until March next year to address these concerns and avoid penalties.

Meta and Apple Discuss AI Integration

Meta Platforms is in talks to integrate its generative AI model with Apple’s new AI system for iPhones. This potential collaboration, alongside similar discussions with Google, could enhance AI capabilities on Apple’s devices, offering broader distribution for AI technologies.

Bank of America Reiterates Buy on Broadcom

Bank of America has reiterated its Buy rating for Broadcom (AVGO), while also raising its price target from $2,000 to $2,150.

Prosecutors Recommend Criminal Charges Against Boeing (BA)

U.S. prosecutors have advised senior Justice Department officials to bring criminal charges against Boeing, alleging violations of a settlement related to two fatal crashes. The Justice Department must decide by July 7 whether to prosecute, marking a critical juncture for the aerospace giant.

Target Partners with Shopify to Enhance Target+ Marketplace

Target (TGT) has announced a strategic partnership with e-commerce platform Shopify (SHOP) to expand its Target+ marketplace, which features third-party products. This collaboration aims to streamline the onboarding process for Shopify sellers, allowing them to offer their products directly to Target’s vast customer base

ByteDance and Broadcom Develop AI Processor

ByteDance is partnering with Broadcom to develop an advanced AI processor. This move will ensure compliance with U.S. export restrictions and support ByteDance’s need for high-end chips amid ongoing U.S.-China tensions. The processor will be manufactured by Taiwan’s TSMC, bolstering ByteDance’s technological capabilities.

Eli Lilly’s Zepbound Shows Promise for Sleep Apnea

Eli Lilly announced that its weight-loss drug Zepbound has shown effectiveness in resolving moderate to severe obstructive sleep apnea in up to 52% of patients in late-stage trials. The promising results were presented at the American Diabetes Association’s scientific meeting, highlighting Zepbound’s potential beyond weight loss.

Nvidia Expands AI Technology in the Middle East

Nvidia has signed a deal to deploy its AI technology in data centers owned by Qatari telecom group Ooredoo across five Middle Eastern countries. This initiative marks Nvidia’s significant entry into a region where U.S. export restrictions aim to limit Chinese access to advanced AI technology.

TD Securities Maintains Buy Rating on Agnico-Eagle Mines with $106 Target

TD Securities has reaffirmed its positive outlook on Agnico-Eagle Mines (AEM), maintaining a Buy rating on the stock and setting a 12-month price target of $106 per share.

Under Armour Settles Shareholder Lawsuit for $434 Million

Under Armour has agreed to pay $434 million to settle a 2017 class action lawsuit accusing it of misleading shareholders about its revenue growth. The proposed settlement, pending court approval, avoids a July trial and underscores the importance of corporate accountability in financial reporting.

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