Good morning! Here’s what you need to know on Monday.
Nicolas Sarkozy has dropped out of the race to be next French president. Francois Fillon heads into a runoff campaign for France’s conservative presidential ticket on Monday as favourite after winning the endorsement of ex-president Sarkozy whom he ousted from the race after a stunning late surge in polls. Fillon will face off against fellow former prime minister Alain Juppe.
Oil is climbing. Oil prices rose around 1% on Monday as producer cartel OPEC moved closer to an output cut to rein oversupply that has kept prices low for over two years. Around 6.40 a.m. GMT Brent crude, the international benchmark is up 1.24% to $47.44.
Russian President Vladimir Putin is confident a deal will be struck. “Whether an agreement will be reached, I can not say for one hundred per cent, but there is a strong likelihood that it will be achieved,” Putin told reporters on Sunday after he attended the Asia-Pacific Economic Cooperation summit in Lima, Bloomberg reports. “Main contradictions within OPEC if not yet eliminated, they can be eliminated.”
Japan’s stock market is gaining momentum. The benchmark Nikkei rose on Monday, gaining for a fourth day after a further weakening in the yen boosted overall sentiment, while mining stocks staged a rally thanks to rising oil prices. The Nikkei share average rose 0.8% to 18,106.02, its highest closing level since January 5. The index has risen for the past four days.
The U.S. Federal Reserve will hold U.S. President-elect Donald Trump to his word on preserving the central bank’s independence, policymaker James Bullard told a German newspaper on Sunday. “The transition team of the President-elect has said that it wants to protect the independence of the Fed,” Bullard told Germany’s Handelsblatt business daily.
China’s hottest property markets are cooling off. Price rises have suddenly stalled in larger centres, quashed by a raft of policy measures introduced to cool price growth in the hottest of hot housing markets. “The slow-down in new home price growth in China last month is largely a result of policy, as authorities look to make purchasing property more difficult to curb rising house prices,” said Vivek Dhar, a mining and energy analyst at the CBA.
Lloyds Banking Group is the favourite to buy Bank of America’s £7 billion UK credit card business. The Financial Times reports that two people briefed on the process said Lloyds had moved ahead of Cerberus, the US private equity group, in the bidding for MBNA’s British credit card operation after BofA backed down on a crucial sticking point in negotiations.
The Labour party is 12 points behind prime minister Theresa May’s Conservative party in the most recent UK voter intention opinion poll, from Opinium. The same poll found May with a 28 point lead over Corbyn in terms of the personal ratings as leaders. Forty-five per cent of people prefer May; just 17 per cent favour Corbyn.
Analysts are openly worrying about Apple’s future profitability. Apple’s gross margins on iPhone sales — a measure of the raw underlying profitability of its business — have declined from 57.7% in 2009 to just 41% today, according to analysts at Bernstein Research. They expect it to sink to a “mere” 39% in 2018.
Tony Blair is positioning himself to return to British politics, it has been reported. The controversial former Prime Minister is engineering a comeback because he feels he can fill a political vacuum caused by Theresa May being a “light weight” and Jeremy Corbyn being a “nutter”, The Sunday Times reports. A source said Mr Blair is sourcing premises near Westminster in order to relocate 130 staff to the UK’s political hub.