June 11th, 2014
Daily Market Commentary
ECONOMIC NEWS
- MBA Mortgage Applications were reportedly up 10.3% in the U.S.
- The Unemployment Rate in Great Britain was reported at 6.6%, below estimates of 6.7%.
- Average earnings excluding bonus in Great Britain was reportedly up 0.9%, below expectations.
Commodities:
- West Texas Intermediate traded near the highest level in three months amid concern that Iraqi unrest may threaten oil supply. Brent rose in London as OPEC ministers meet in Vienna.
- Gold held near the highest in almost two weeks as speculation some investors are cutting bets on lower prices was weighed against signs of an improving U.S. economy. Palladium traded near a more than three-year high.
- Wheat rebounded on speculation that demand will be rekindled after prices slumped to the lowest level in more than three months before a government report that may show global reserves rising to the highest in three years.
- OPEC, which supplies about 40% of the world’s crude, kept its production target unchanged at 30 million barrels a day, a decision that was widely anticipated.
Company News:
Canada:
- Bombardier Inc. restarted ground tests on its new CSeries jet following last month’s failure of a Pratt & Whitney engine and predicted resumption of flight trials “in the coming weeks.”
- Along with the leadership of Canada’s largest province and the keys to its 120 year-old pink- sandstone legislature, the winner of Ontario’s election tomorrow will claim the largest pile of debt of any province, state or local government in the world.
- Allergan said its board has rejected the latest takeover bid from Valeant Pharmaceuticals and Pershing Square Capital, saying the deal creates significant risks and uncertainties and isn’t in the best interest of the company or its stockholders.
United States:
- U.S. stock-index futures declined, after the Standard & Poor’s 500 Index yesterday halted a four- day streak of record closes, as the World Bank cut its forecast for global growth.
- With Amazon.com Inc. planning to unveil its first smartphone next week, prospective customers and options investors have something in common: they’re both lining up to pay for calls.
- Tyson Foods Inc. is willing to dilute shareholders to sidestep a cut to junk-bond status as part of the largest U.S. meat company’s $8.6 billion takeover of Hillshire Brands Co.
International:
- European stocks fell from a six-year high as companies including Deutsche Lufthansa AG and Vallourec SA cut their profit forecasts. U.S. stock-index futures also retreated.
- Siemens AG is in talks with Mitsubishi Heavy Industries Ltd. about a joint bid to acquire Alstom SA’s energy business and counter a $17 billion offer by General Electric Co., according to people familiar with the matter.
- U.K. unemployment fell to the lowest level in more than five years as the strengthening economic recovery boosted payrolls by a record.
- Commerzbank AG, Germany’s second-largest bank, sold $6.9 billion of commercial real estate financing assets in Spain and Japan and non-performing loans in Portugal
- Asia’s benchmark stock index rose, extending gains from a one-year high, fuelled by a rally in Japanese equities. Most stocks in the region outside Tokyo fell after the World Bank cut its global economic growth forecast.
