Lower commodity prices and rising inflation, which could prompt the Bank of Canada to raise interest rates, caused the Toronto Stock Exchange's S&P/TSX composite index to fall by almost 1.5%, its biggest drop for two months. In addition, the energy and financial sectors, which together make up around 60% of the Canadian market's weighting, fell due to a decrease in oil prices and stress levels in the regional US banking sector. It seems that factors such as this have meant that the Toronto exchange has failed to match the rise of leading US stock indices, like the S&P 500, which have benefitted from a marked improvement in tech stocks.
South Africa’s rand weakened after the country’s unemployment figures for Q1 2019 were released, showing the rate to have risen to 32.9%. The data suggests that South Africa’s economy may be in worse condition than previously thought following last week’s economic turbulence due to accusations that South Africa provided arms to Russia, and the worst rolling blackouts ever, which have seen households and businesses left in the dark for up to 10 hours per day.
Indian stocks are expected to open lower after Wall Street closed lower amid the debt ceiling negotiations in the US; Asian markets were also affected. Investors are also expected to be booking profits after a 5% increase in the benchmark Nifty 50 since the beginning of the fiscal year in 2024. The National Stock Exchange reported that foreign institutional investors have extended their buying streak for the 14th consecutive session, adding $172.1m worth of shares in the period. Analysts are watching the results of companies including Jubilant FoodWorks, Whirlpool of India and Devyani International.
Beazley announced average premium-rate increases of around 10% for contract renewals in its Q1 update, boosting profits for the non-life insurer, despite ongoing debate over war exclusions for cyber crime. A $400m fundraising move in late 2022 strengthens the company's hand to allow it to take further advantage of the firm pricing environment. Gross premiums written rose by 12% year-on-year in the first quarter to $1.4bn, propping up expectations of a 15% increase in gross premiums written to $6.1bn ongoing. Beazley's reaching of the mid-teens growth rate aligns with management's guidance.
Global share buybacks hit a record of $1.3tn last year, three times the level seen 10 years ago, according to Janus Henderson, with US firms the biggest buyers and the trend also spreading rapidly across Europe. Advocates say share buybacks can boost stock prices and benefit shareholders, with taxes on capital gains often lower than on dividends. But critics contend that companies underpay staff or cut back on R&D to fund buybacks, while US president Joe Biden has included a new tax on buybacks to fund his climate package.
The CEO of Regeneron has supported the Federal Trade Commission’s (FTC) move to block Amgen’s acquisition of Horizon Therapeutics, following the FTC’s first legal move to block a pharma deal in over a decade. Regulators have typically focussed on companies buying up drugs to corner the market. However, the FTC’s lawsuit against Amgen claims the company has too much power overall among US health insurers and pharmacy benefit managers. Regeneron is itself in a legal dispute with Amgen, accusing the company of abusing market power and violating antitrust laws in the way it marketed a cholesterol drug.
Shares of US regional lenders jumped in pre-market trading on Wednesday, boosted by deposits growth at Western Alliance Bancorp. The bank's shares soared 11% to $35.18 after it announced deposit growth of more than $2bn had exceeded expectations. In addition, Bank of America Global Research issued a "buy" rating for Western Alliance, saying its business model was "more resilient than perceived”. Worries around a broader crisis have battered regional lenders' stock valuations due to funding costs and customers moving their money into larger banks.
Target has forecasted a low-single digit decline in sales for 2Q amid consumers shunning non-essentials such as electronics and home goods due to persistently higher prices. The company has been trying to shift its focus to household essentials and groceries as inflation and higher interest rates continue to prompt consumers to trade down. The retailer also warned that theft and organised crime could reduce profitability by more than $500m compared to 2022. However, the company has maintained its 2023 annual profit forecast.
Investors are assessing the potential consequences of the Federal Trade Commission’s lawsuit challenging Amgen’s planned $27.8bn acquisition of Horizon Therapeutics, speculating it may lead to regulatory opposition to other big deals in the drug sector. Following the FTZ’s suit, the shares of Seagen, which Pfizer agreed to acquire for $43bn in March, dropped 6% to $187.64, as concerns mounted US regulators might challenge the deal too.
Chinese tech giant Tencent has reported a boost in Q1 2023 revenue of 11%, driven by growth in advertising and game sales. Total revenue reached CNY150bn ($21.4bn), up from CNY135.5bn in the same period last year and better than consensus estimates, company founder and CEO Pony Ma Huateng said. Profit rose 10% to CNY25.8bn from CNY23.4bn, falling short of analyst expectations. The results came as China's economy emerged from the pandemic, boosting consumer and advertising spending. Tencent, operator of China's biggest social media platform, has been consolidating operations following a year of cost-cutting measures.
India's Sterlite Tech swings to profit in Q4 on optical networking boost
Reuters
23-05-17 08:58
Indian firm Sterlite Technologies has reported consolidated net profit of INR650m ($8m) for Q4 2022, compared to a net loss of INR220m in the same period a year ago. Consolidated revenue from operations increased by 25% to INR18.72bn. The company provides end-to-end data connectivity solutions, produces optical fibres, and builds infrastructure for cable and mobile networks, including 5G, such as for Bharti Airtel, UK company Netomnia and Australia's Vocus Group. Sterlite's board has also approved demerging its global services business arm into a to-be-listed unit called STL Networks.
India's GlaxoSmithKline Pharma's pre-tax profit falls on govt pricing caps
Reuters
23-05-17 13:31
GlaxoSmithKline Pharmaceuticals has reported an 8.6% fall in its pre-tax profit for Q4 2017, citing the Indian government’s curbs on some essential drug pricing as the source of its issues. The Indian arm of GSK stated that its profit before tax fell from INR 2.08bn ($32.04m) to INR 1.9bn for the quarter ending on 31 March. The maker of Augmentin antibiotic and T-Bact ointment also saw its revenue from operations fall 2.7% to INR 7.87bn during the period.
India's JK Tyre reports nearly three-fold increase in Q4 profit
Reuters
23-05-17 12:55
JK Tyre has released Q4 2017 results, reporting a profit of $13.2m, a 269% improvement from last year. The growth follows falling raw material costs and a boost in domestic demand, with sales from operations growing almost 10% YoY. The company's raw material costs fell by over 4% to $314m for the period, compared with a growth of 21% YoY. JK Tyre is known for its relationships with Indian motor companies Maruti Suzuki and Tata Motors. Rival tyre producers including MRF, CEAT and Apollo all posted similar results to JK Tyre.
Japanese e-commerce group Rakuten has outlined plans to raise up to $2.5bn by issuing new shares. About 500 million new shares will be issued, resulting in a 30% dilution of existing shareholders' equity if they choose not to buy more shares in the business. Rakuten will use the funds to support its ailing mobile telecoms unit, which reported a JPY102.6bn ($940m) loss in Q1 2022, offsetting profits in its lucrative fintech and e-commerce divisions. The fundraising move followed a 17% share price fall on Monday, when rumours of the share issue began to circulate.
Barclays is said to be planning a major push to grow business in Paris, with the aim of expanding its headcount in the city by around 200 people over the next two to three years. The bank already has around 300 employees in the French capital and plans to move to larger premises next year. In March, Paris overtook London as Europe’s largest stock market with the UK capital now $250bn (£204bn) smaller than the French equivalent. It lost its place as Europe’s largest centre for trading equities for the first time last year when Paris overtook it.
Wall Street rallied on Wednesday on hopes that the US government will avoid defaulting on its debt. The S&P 500 was up 1.2% and the Dow Jones Industrial Average was up over 1.3%. The Nasdaq composite was also up roughly 1.3%. Despite the recent optimism, fears that the US may default on 1 June continue to grip markets. If Congress does not allow the government to borrow more money by this date, it could be disastrous for Treasurys, likely leading to a wider damage across the US economy.
Air Canada is rumoured to be close to finalising the acquisition of between 15 and 20 787 Dreamliners from Boeing to renew and expand its long-haul fleet. The airline's management have not made any official announcement, whilst Boeing has declined to comment on the rumours. Airlines are currently seeking to restock their wide body fleets in advance of a busy summer travel season, prompted by a resurgence in demand for long-haul flying.
Martin Franklin, a veteran of buyout vehicles, raised $550m by listing his latest blank-cheque company, Admiral Acquisition, in London on 22 September. The Spac features various features that diverge from the standard blank-cheque format, tweaks that are intended to inspire investor confidence. The $100m committed by Franklin and his fellow founders is likewise intended to boost the attractiveness of Admiral.
Synopsys sees Q3 revenue above estimates as AI drives upbeat results
Reuters
23-05-17 20:48
Chip-design software provider Synopsys has reported Q2 revenue of $1.4bn, surpassing estimates, as increased AI usage and automation in the industry boosted its business. Though analysts had estimated adjusted earning per share at $2.46, Synopsys beat that number with $2.54 profit per share. The firm anticipates a Q3 revenue of $1.47bn to $1.5bn and adjusted earnings per share in the range of $2.70 to $2.75.
Data analytics firm New Relic in talks to be sold - WSJ
Reuters
23-05-17 20:15
Private-equity firms Francisco Partners and TPG are collaborating on a $5bn bid for software firm New Relic, according to unnamed sources cited by the Wall Street Journal. The move follows reports in July that the firm, which develops cloud-based systems to help site and app owners track performance, was considering offers from private-equity players. Reports suggest a deal could be completed within weeks. Representatives from the companies declined to comment.
