At the start of the week, despite growing geopolitical uncertainty, US equity futures rose with European stocks following a mixed market in Asia as the trade-war turmoil that has hung over the markets showed few signs of receding, reported Bloomberg.
On Tuesday Google said it plans to work with China’s Huawei just after the US temporarily eased some trade restrictions on the smartphone manufacturer, reported CNBC. The move marked something of a turnaround for the US tech giant. On Sunday, Google had said it would cut ties with Huawei to comply with US President Donald Trump’s decision to put China’s telecom giant on the so-called Entity List.
The picture for technology stocks was not good, however: they had a tough time after some US businesses complied with the restrictions against Huawei, according to The Wall Street Journal.
On Tuesday, British sub-prime lender Provident Financial was facing a shareholder revolt over its pay report at the firm’s AGM, reported The Sunday Times. The company’s CEO Malcolm Le May, who has a basic salary of £700,000 ($886,000), is eligible for a bonus of up to £1.2 mn – up 46 percent from last year. Despite the discontent, however, all resolutions at the meeting were passed, reported Morningstar.
In a worrying sign for the automotive and tech company, Morgan Stanley cited a worst-case forecast on Tesla’s shares, cutting them from $97 to just $10 this week, referring to worries about the company’s increased debt and geopolitical exposure, reported CNBC. Morgan Stanley analysts also said the reduction was driven by concerns around Chinese demand for Tesla products.
On Wednesday, Amazon shareholders got ready to go into battle against the tech company over the sale to police forces of its facial recognition technology. At the Seattle meeting, activist shareholders pushed for Amazon to provide more oversight on the sale of its Rekognition software to law enforcement, reported The Telegraph. CNN then reported that Amazon won the vote, but the report highlighted that the concerns the issue and vote raised are not going to go away.
On Wednesday, British retailer Marks & Spencer adjusted its store closure program as annual results showed sales and profits falling, with figures for the year to March 30 showing underlying pre-tax profits falling 10 percent to £523.2 mn, reported Sky News.
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President Xi Jinping of China has called for Chinese people to begin a modern ‘long march’– referencing a time of hardship from the country’s past – as it gets ready for a drawn-out trade war with the US, reported The New York Times. The comments appear to be an attempt to inspire the Chinese people as President Trump continues to press China on trade.
China is also looking at taking more severe action as a result of its trade dispute with the US, according to the South China Morning Post. While China is open to resuming trade talks, the paper notes that ‘government advisers are now highlighting the risk of sourcing critical supplies from an increasingly hostile US… and are exploring ways for the country to cut its exposure to the US’, citing Chinese researchers. The article –titled Donald Trump’s trade war and Huawei ban push China to rethink economic ties with US – says China is considering cutting natural gas purchases from the US as part of this approach.
Shares of Chinese coffee shop chain Luckin Coffee fell more than 7 percent in trading on Wednesday, joining the likes of Uber and Lyft in dropping below their IPO price just days after the firm’s debut, reported CNBC.
The alliance between Renault, Nissan and Mitsubishi is destined to become unsustainable unless changes are made, said French minister of the economy and finance Bruno Le Maire on Wednesday, according to The Nikkei Asia Review. The French government is the largest shareholder in Renault, with a 15 percent stake.
Investors have pulled money from emerging market stocks in the past week at the fastest rate since the Turkey currency and debt crisis last year, reported The Financial Times.
Billionaire investor George Soros has taken a 3 percent stake of beleaguered Swiss asset management firm GAM, according to a filing on the Swiss stock exchange, reported City AM on Friday. The stock bought by Soros Fund Management pushed shares in GAM up 8.8 percent in early Friday trading.
Following UK Prime Minster Theresa May’s Friday announcement of her intention to resign on June 7, sterling moved higher. But Moody’s warned that the risk of a no-deal Brexit was now more likely, according to The Guardian.
