Here is what you need to know.
Saudi Arabia is pumping out more oil than ever before. Saudi Arabia ramped it oil production up another 123,000 barrels per day to 10.67 million, the most on record. The record production is evidence that Saudi Arabia doesn’t care so much about the oil price, and would rather wipe out its competition.
China devalued its currency one year ago. In an effort to ignite China’s slowing economy, the People’s Bank of China devalued the yuan by 1.85% to 6.2298 per dollar. The devaluation sent shockwaves around the world, causing the S&P 500 to tumble about 11% over the next two weeks. On Thursday, the yuan ended at 6.6401 per dollar, weaker by an additional 6.6%.
New Zealand cut rates to a record low. In an expected move, the Reserve Bank of New Zealand lowered its key interest rate to a record low 2.00%. The central bank’s board suggested this won’t be the last rate cut, stating, “current projections and assumptions indicate that further policy easing will be required to ensure that future inflation settles near the middle of the target range.” The New Zealand dollar is stronger by 0.7% at .7257 per dollar.
Valeant is reportedly under criminal investigation. Federal investigators are considering charging the troubled Canadian pharmaceutical company with defrauding investors as a result of its relationship with specialty pharmacy Philidor, the Wall Street Journal reports. The report says investigators are looking into whether or not Philidor unfairly directed patients toward higher-priced drugs made by Valeant instead of lower-cost options without revealing the relationship between the two firms.
Wendy’s CEO says people don’t want to eat there because of the election. During the company’s second quarter earnings call on Wednesday, CEO Todd Penegor said the uncertainty surrounding the presidential election is weighing on consumer sentiment, and its causing less people to eat at restaurants such as Wendy’s. “And when a consumer is a little uncertain around their future and really trying to figure out what this election cycle really means to them, they’re not as apt to spend as freely as they might have even just a couple of quarters ago,” Penegor said. He also pointed to the increasingly large difference between the cost of food at home and food away from home.
Shake Shack is getting crushed after sales missed. The fast-casual burger chain beat on the top and bottom lines, earning $0.14 per share on revenue of $66.5 million. However, comparable same store sales missed estimates, coming in at up 4.5% versus the Wall Street estimate of up 5.4%. Shake Shack shares were8% in after-hours action.
Google has a new venture capital head. David Krane is taking over Google’s $2.4 billion venture capital business after Bill Maris left the company on Wednesday. Krane was previously a managing partner at the fund, and has invested in companies such as Uber, Nest, and Blue Bottle Coffee.
Stock markets around the world trade mixed. China’s Shanghai Composite (-0.5%) lagged in Asia and France’s CAC (+0.8%) leads the gains in Europe. S&P 500 futures are up 4.50 points at 2,177.25.
Earnings reporting is moderate. Alibaba, Kohl’s, and Macy’s will report ahead of the opening bell while Nordstrom releases its quarterly results are markets close.
US economic data is light. Initial jobless claims will be released at 8:30 a.m. ET and natural gas inventories are due out at 10:30 a.m. ET. The US 10-year yield is higher by 2 basis points at 1.52%.
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