Good morning! Here’s what’s happening…
1. S&P 2000. Congratulations everyone – the S&P 500 crossed the 2000 mark in the overnight session in the US. Westpac’s Graeme Jarvis tweeted this chart showing the rally towards the landmark but also noting that the VIX, an index of how volatile traders think prices are going to be, was ticking upwards at the same time – and new highs don’t often come at the same time as this kind of anticipated instability. Greg McKenna looks at what’s behind this here.
2. The main US indices gained about half a point in the overnight session, though the S&P closed just under its intraday high at 1998.14. The top story of the day was Burger King’s merger talks with a Canadian doughnut chain that would see BK move its tax base offshore. Burger King shares were up 20% on the news. It follows a mixed day in Asia yesterday which saw Shanghai lose 0.5% while the Hang Seng gained 0.2% and the Nikkei was up 0.5%. ASX futures are pointing to a slight rise at the open, following a fall of 0.2% yesterday. Also overnight, Deutsche Bank economist Torsten Slok issued a note overnight with the subject line “Buy equities”, saying he doesn’t think there’ll be a correction until there’s a US recession.
3. Federal cabinet met yesterday and was briefed on political strategy for the weeks ahead. Phil Coorey reports at the AFR that ministers were told by senior Liberal party officials including Brian Loughnane and that they needed to avoid any more distractions, to stick to the middle, and “no more ideology”. They will also be abandoning the language of budget crisis, and only take votes on budget measures to the Senate when they’ve done a deal with the crossbenchers. Let’s see how they go.
4. Amazon just paid almost $US1 billion for Twitch, a site where you watch people playing video games. Twitch is huge: in April, it accounted for 40% of all live-streaming traffic in the US; it also accounts for around 2% of all video traffic in the US. Users spend an average of 100 minutes per day on a site – essentially watching a movie-length production. The company’s last investment, last year, valued the company at $US100 million. Nice payday for the founders and investors.
5. Mobile phones and tablets can be used on Australian airlines from today. Just switch to flight mode at the gate and you can play away on Candy Crush for the entire time you’re in the air – no more powering down for take-off and landing or during taxiing. Laptops still need to be stowed. Virgin Australia passengers could do it from this morning and the change kicks in on Qantas from 3pm AEST.
6. The Netflix challenge in Australia. Everyone expects Netflix to finally make a move into the Australian market, but there are a few problems with that, mainly that licenses for content that they would have on the US platform, which you can access using a simple workaround from Australia, might not extend to this country.
7. Scotland and England are on the brink of ending a 307-year-old relationship. The referendum which will decide if the two part ways is just over three weeks away. There’s a great differentiation between the for and against arguments in that the Scottish government says Scotland will be in better financial shape as a country if it splits (backed by the WSJ), while the UK is playing the man (read “dirty”), saying each Scot will be $US2400 richer per year if it stays with the UK.
8. The horrors of war. You can see pics of grinning GIs with rows of Viet Cong heads at the War Remnants Museum in Ho Chi Minh City along with the rest of a very one-sided view of the Vietnam War. Not surprisingly, Americans who visit the museum are shocked, including author Christina Schwenkel, who wrote about it.
9. Disruption in the payments space is an topic which banking executives will admit causes them sleep loss. There are a range of options for companies of all shapes and sizes when it comes to payments, and it’s something that can not only help drive transactions (by ease of use) but also improve customer service. We’ve taken a look at how you can be smarter about payments here.
10. The cracks in Nick Kyrgios appear. Our new tennis sensation stormed through the first round of the US Open, dispatching Mikhail Youzhny 7-5 7-6 (7-4) 2-6 7-6 (7-1) this morning. But hopes the 19-year-old would be a class above wunderbrat Bernard Tomic wobbled a bit when Kyrgios nearly forfeited the match with a bad-tempered display. He smashed a ball out of the stadium and dropped the F-bomb a couple of times, the second of which caused him to be docked a game. A fourth code violation would have seen him sent off.
Bonus item: Mitchell Johnson smashed the commentary box window with a massive six over the bowler’s head during the first one-day international in Harare overnight.
Have a cracking day. I’m on Twitter: @colgo
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