Stock Market Analysis & Corporate News: Aug 27th, 2024

Global Markets

• Canada: The Toronto Stock Exchange (TSX) experienced a decline, driven primarily by falling prices in crude oil and gold. The drop in these key commodities impacted the energy and mining sectors, which are significant components of the TSX. Investors also were reacting negatively to disappointing earnings reports from the Bank of Montreal (BMO), which missed analyst expectations and highlighted ongoing weaknesses in its U.S. retail segment and higher credit provisions.
• United States: American markets were generally lower as investors adopted a cautious stance. This hesitation comes ahead of critical earnings reports from Nvidia and key U.S. inflation data expected later this week. Nvidia’s earnings are particularly anticipated due to the company’s significant role in the semiconductor and AI sectors, while inflation data is crucial for understanding the economic outlook and potential impacts on Federal Reserve policy.
• Europe: European and UK stock markets showed mostly positive performance. This uptrend was fueled by gains in the mining sector, which benefited from a rebound in commodity prices. However, there are concerns in the UK regarding the upcoming fall budget, as UK Prime Minister Keir Starmer has warned that it could be challenging. This caution reflects potential economic pressures and fiscal policies that could affect market sentiment.
• Japan: The Nikkei index saw gains, boosted by a weaker yen, which benefits export-oriented companies by making their products cheaper for foreign buyers. The yen’s decline supports Japanese exporters’ competitiveness on the global stage.
• China: Chinese markets faced headwinds and experienced declines. This downturn was influenced by new tariffs imposed on Chinese electric vehicles and steel imports, which could negatively impact key sectors and overall market sentiment. The tariffs add to existing economic challenges and trade tensions.

Corporate Stock News

• Alimentation Couche-Tard Inc: Japan’s Seven & i Holdings is urged by activist shareholder Artisan Partners to negotiate a takeover bid from Couche-Tard. Artisan believes the deal has historic implications and advises Seven & i to act quickly.
• Apple Inc: Apple named Kevan Parekh as CFO, replacing Luca Maestri who will transition out in January 2025. Parekh, an insider, will join the executive committee ahead of Apple’s major product launches this fall.
• Bank of Montreal (BMO): Reported a quarterly profit below estimates for the sixth consecutive time due to increased provisions for potential bad loans and weaker performance in the U.S. retail segment.
• Bank of Nova Scotia: Posted a fall in third-quarter profit due to higher provisions for credit losses amid economic uncertainty. Net income decreased from C$2.19 billion to C$1.91 billion.
• Blackstone Inc: Submitted final offers to acquire Australian data center group AirTrunk in a $13.55 billion transaction. Bids are under review with no set deadline for a decision.
• BHP Group Ltd: Focuses on expanding its copper business following a failed acquisition attempt of Anglo American. Reported a better-than-expected 2% rise in annual underlying profit.
• BYD Co Ltd: Partnered with Huawei to use its autonomous driving system in BYD’s Fangchengbao EVs, highlighting the company’s move to upscale and enhance its smart driving technology.
• Eli Lilly and Co: Launched single-dose vials of its weight-loss drug Zepbound in the U.S. to improve access for patients without insurance reimbursement.
• Emergent BioSolutions Inc: Announced a reduction of up to 70 roles at its Lansing, Michigan plant as part of a restructuring effort.
• Equinor ASA: The Arctic Johan Castberg oilfield is expected to reach full production by early 2025, with a projected output of 220,000 barrels per day.
• Hewlett Packard Enterprise Co: To receive $50 million from the U.S. Commerce Department to expand and modernize its Oregon facility, focusing on semiconductor technologies.
• JD.com Inc: Approved a new $5 billion share repurchase program to be executed over the next 36 months, aiming to counter competition in the Chinese e-commerce market.
• Linde PLC: Plans to invest over $2 billion in a clean hydrogen facility in Alberta, Canada, set to be the largest in the country and support Dow’s Path2Zero project.
• Lowe’s Companies Inc: Scrapped some diversity, equity, and inclusion (DEI) programs and made changes to community event participation as part of its policy adjustments.
• Meta Platforms Inc: CEO Mark Zuckerberg disclosed pressure from the Biden administration to censor COVID-19 content and announced plans to avoid political contributions in the upcoming election.
• Paramount Global: Media veteran Edgar Bronfman Jr. withdrew from the bid for Paramount, paving the way for Skydance Media to take control of the media giant.
• Pfizer Inc: Launched a new website, PfizerForAll, to improve access to its healthcare offerings, including treatments for migraines and respiratory illnesses.
• PDD Holdings Inc: Missed revenue estimates, with downbeat forecasts from executives leading to a significant drop in market capitalization.
• Ryanair Holdings PLC: Lost its appeal against a ban on extra fees for seat reservations. CEO Michael O’Leary expressed disappointment with Boeing’s delayed aircraft deliveries.
• Sony Group Corp: Settled claims with India’s Zee Entertainment and will increase the price of PlayStation 5 consoles in Japan by about 20%.
• Tesla Inc: A federal appeals court revived Tesla’s lawsuit challenging Louisiana’s ban on direct vehicle sales. Canada announced a 100% tariff on Chinese EV imports, affecting Tesla.
• Toyota Motor Corp: To enhance its partnership with BMW in fuel cell vehicles, with a memorandum of understanding expected next week.
• Walt Disney Co: Negotiating with DirecTV to renew a contract, with potential blackouts of channels if an agreement isn’t reached. Disney also overturned a $600,000 verdict related to motion-capture technology in “Beauty and the Beast.”
• Woodside Energy Group Ltd: Reported a 14% drop in half-year profit due to lower oil prices, but beat market expectations. It is also seeking equity sales for its U.S. LNG project.