Good morning! Here’s what you need to know in markets on Friday.
1. Asian stocks eked out modest gains on Friday as investor caution prevailed amid concerns about the European Union imposing retaliatory tariffs on US goods while US President Donald Trump’s criticism of Federal Reserve policy knocked the dollar. Japan’s Nikkei stock index closed down 0.29%, the Hong Kong Hang Seng is up by 0.65% at the time of writing (7.25 a.m. BST/2.25 a.m. ET), and the Shanghai Composite is up 2.23%.
2. President Donald Trump told CNBC he wasn’t “thrilled” with the Federal Reserve raising interest rates. The comment breaks with a long-standing tradition of US presidents not commenting on central-bank policy. The dollar slipped against the pound and euro in the wake of the comments.
3. Copper prices on the London Metal Exchange slipped below $US6,000 for the first time in a year Thursday. Analysts say trade escalations are weighing on a market already under pressure.
4. Microsoft stock jumped over 4% in after-hours trading after crushing earnings. The jump occurred after Microsoft gave bullish guidance for the next quarter on a conference call with investors.
5. First-half profits at Beazley, the insurer, dropped by almost two-thirds as claims costs rose and investment returns fell. The Financial Times reports that London-based Beazley said rising US interest rates had dented its investment portfolio. Investment income slipped from $US79 million to $US8 million in the first half of the year.
6. Traders largely aren’t moved by President Donald Trump’s tweets on trade, except in the soybeans market. Economists at Goldman Sachs used a regression analysis to look into the relationship between Trump’s tweets and the performance of various asset classes.
7. Goldman Sachs has hired an up-and-coming equity derivatives trader from Barclays, according to FINRA records and people familiar with the matter. Competition for equities talent has been fierce in 2018 amid a rebound in volatility that has revived banks’ stock-trading businesses, a trend that has been epitomized by the equity derivatives sector.
8. Comcast announced on Thursday that it was no longer pursuing its bid to buy some of 21st Century Fox’s assets. This ended a bidding war it had entered with Disney for the assets, which exclude the Fox News and Fox Business channels. Comcast said it would now focus on its bidding war with Fox for the British broadcaster Sky.
9. Tesla sank 2.5% in early trading Thursday after Needham downgraded shares to “underperform,” citing disappointing Model S and X sales, increasing margin pressures, and a flurry of electric-vehicle competition from traditional automakers. “We are downgrading Tesla to Underperform from Hold as we believe the stock is still overvalued despite falling 16% from its June 2017 peak (the S&P 500 is up 15% over the same 56-week period),” analyst Rajvindra Gill said in a note to clients Thursday.
10. Macquarie’s Viktor Shvets has identified seven “themes” that will shape the future of the global economy. Shvets, a strategist known for his unconventional perspectives, includes topics like “bullets and prisons” and “opium of the people” in his presentation.
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