Good morning! Here’s what you need to know on Tuesday.
Russia’s VTB bank became the first official banking casualty of Brexit. The bank will relocate its European headquarters to another city, the Financial Times reports. “”We did have bigger plans for the London office, but after Brexit we are scaling them down and building them up elsewhere,” VTB’s CFO Herbert Moos said.
Goldman Sachs said a planned oil output cut by producer cartel OPEC and other exporters like Russia has become a “greater possibility,” but warned that any reduction likely won’t be deep enough to re-balance markets in 2017.
The U.S. Federal Reserve should engineer monetary policy to spur inflation to rise above its two-per cent target because the costs of doing so are less than in past decades, Chicago Federal Reserve Bank President Charles Evans said on Tuesday.
The market looks eerily similar to the days right before the 1987 crash. When Citi’s Tom Fitzpatrick and his team overlaid the current chart of the benchmark S&P 500 with the index in 1987 they got “the chills.”
Asian shares were mixed in Asian trading on Tuesday after oil prices surged to a one-year high and optimism over Hillary Clinton’s widening lead in the U.S. presidential election campaign pushed Wall Street higher. China’s Dow Jones Shanghai gained around 0.3%, while Hong Kong’s Hang Seng fell 1.4% as of 6:50 a.m. BST (1:50 a.m. ET). Japan’s Nikkei is closed for a holiday.
Samsung insists that its replacement Galaxy Note 7 smartphones are “safe to use” — despite at least five reports of these devices melting, catching fire, and smoking uncontrollably. The South Korean electronics company is currently at the centre of an unprecedented catastrophe after dozens of customers reported that their new Note 7 phones — the latest high-end flagship device from the company — were melting and exploding due to battery faults.
Oliver Hart and Bengt Holmström were awarded the 2016 Nobel Memorial Prize in Economic Sciences on Monday. They were given the prize for their work on contract theory, the study of how contracts and incentives influence decision-making and business relationships.
There is a small chance that the UK could still stay in the European Union, despite the country’s vote to leave the bloc, according to new research from economists at Morgan Stanley. In a new note released on Monday, MS economists Jacob Nell and Melanie Baker argue that the possibility that the country could actually stay within the European Union is not entirely off the cards.
The Conservatives are facing a huge backlash from businesses over their ‘dangerously naïve’ foreign worker plans. More than 100 business leaders have signed an open letter to UK home secretary Amber Rudd criticising a proposal to force companies to disclose lists of foreign-born employees to the government. The letter calls the proposed policy ” anti-worker, anti-business and dangerously naïve.”
One of Theranos’ major investors is suing the company. Partner Fund Management LP invested $96.1 million in Theranos back in 2014.