Good morning! Here’s what you need to know in markets on Tuesday.
British Prime Minister Theresa May has written a letter to China’s President Xi Jinping and Premier Li Keqiang expressing a wish to enhance trade and cooperation on global issues between the UK and China, China’s foreign ministry said, citing Britain’s Minister for Asia and the Pacific. Alok Sharma, Parliamentary Under Secretary of State at the Foreign and Commonwealth Office, made the remarks during his meeting with China’s foreign minister Wang Yi in Beijing.
UK inflation is coming. A big data dump at 9.30 a.m. BST (4.30 a.m. ET) will reveal changes in retail prices, producer prices, and consumer prices in July. The headline consumer price index is expected to fall into month-on-month decline, with economists predicting a 0.1% fall in prices.
American International Group (AIG) is nearing a deal to sell its mortgage-guaranty unit to Arch Capital for about $3.4 billion (£2.6 billion), the Wall Street Journal reported on Monday, citing people familiar with the matter. The companies could strike a deal as soon as early this week, the Journal reported, although it added that the talks could still fall apart.
The US Department of Justice has found Volkswagen liable for criminal wrongdoing, CNBC first reported. Volkswagen is expected to face criminal and civil penalties for violating the Clean Air Act by installing software on vehicles that violates environmental standards meant to reduce smog, but prosecutors have yet to decide the specific criminal charges they might bring against the automaker.
The S&P 500 and Nasdaq started the week by rising to all-time intraday highs overnight on Monday. Both stock indices traded in the tight range that has characterised markets for the last few summer weeks: This is the 26th straight trading day where the S&P 500 moved less than 1% in either direction.
Boutique advisory firms now receive nearly half of all M&A fees in Europe, stealing market share and top dealmakers from global investment banks hamstrung by a renewed focus on cost-cutting and regulation. Reuters reports that the boutiques are founded largely by veterans fleeing bureaucracy and shrinking paychecks at the large banks and these low-profile small firms prove popular among companies who value their niche expertise and independent advice as opposed to mega-banks who tend to cross-sell other services like financing.
Maersk is warning about two important parts of the global economy. In its earnings results on Friday, the Danish shipping conglomerate, which is the world’s largest, restated its expectation for declines across most of its businesses this year. And it warned about the damage that changes to US trade policy could cause to the global economy.
Warren Buffett’s Berkshire Hathaway bought more Apple shares in the second quarter, according to its latest form 13F filing. The regulatory filing showed that the company bought 5.42 million Apple shares to bring its tally to 15.2 million, valuing its stake in the tech giant at $1.46 billion (£1.1 billion).
Morgan Stanley may be about to get the activist investor treatment. ValueAct, the activist hedge fund run by Jeff Ubben, disclosed a chunky position in the stock in the fund’s 13F filing.
Snapchat is buying search startup Vurb in a stock and cash deal totaling around $200 million (£154.8 million), as first reported by The Information. About half of that money will go to investors, while the rest will go as retention payouts to current employees — an unusually high proportion.
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