1. Stocks Steady as Earnings Take Focus Off Bonds
Stocks in Europe snapped their longest streak of losses since October as Treasuries steadied, while attention shifted to corporate earnings and economic data. Oil added to recent losses. The Stoxx Europe 600 index fluctuated before heading higher for the first time in four days. Futures on the S&P 500 and Nasdaq 100 gained and the dollar weakened. With the yield on the 10-year Treasury benchmark settling back around 1.3%, the focus is turning to corporate earnings reports. Rising yields dominated discussion this week and raised concern about the staying power of the New Year rally. The fear is that a rise in borrowing costs and price pressures could derail the economic recovery.
The Stoxx Europe 600 index climbed 0.3% by 9:40 a.m. in London.
S&P 500 futures added 0.3%.
The MSCI Asia Pacific index was little changed.
MSCI’s Emerging Markets index rose 0.2%.
2. Bitcoin Nears $1 Trillion Value as Crypto Jump Tops Other Assets
Bitcoin is closing in on a market value of $1 trillion, a surge that’s helping cryptocurrency returns far outstrip the performance of more traditional assets like stocks and gold. The largest token has added more than $415 billion of value in 2021 to about $956 billion. Speculators, corporate treasurers and institutional investors are thought to have stoked Bitcoin’s volatile ascent. Crypto believers are duelling with sceptics for the dominant narrative around the climb: the former see an asset being embraced for its ability to hedge risks such as inflation, while the latter sense a precarious mania riding atop waves of monetary and fiscal stimulus.
3. Biden to Visit Pfizer Vaccine Plant as U.S. Shots Accelerate
President Joe Biden will travel Friday to the Michigan plant where Pfizer Inc. is manufacturing its Covid-19 vaccine as his administration works to boost the number of shots delivered each day. The plant, in Portage, just outside Kalamazoo in southwest Michigan, is Pfizer’s largest manufacturing facility. There, the company’s coronavirus vaccine is formulated and filled into vials before being shipped for distribution. Biden has regularly touted his administration’s progress accelerating vaccinations and has encouraged any American with the opportunity to take a shot. “If you’re eligible, if it’s available, get the vaccine. Get the vaccine,” he said during the Tuesday town hall.
4. Pound Rises Past $1.40 for First Time Since 2018 in Vaccine Play
The pound surged through $1.40 for the first time in nearly three years as investors bet the U.K.’s rapid vaccine rollout will help pave the way for a reopening of the economy this year. Sterling is headed for the sixth week of gains after the U.K. hit its target of immunizing its top four priority groups, including the over 70s, by Feb. 15. That progress could enable the country to ease its coronavirus measures, which sparked the worst recession since 1709 last year. “The bullish case for the pound versus both the euro and dollar remains intact,” said Petr Krpata, a strategist at ING Groep NV, which expects it to finish the year above $1.50. “Against the euro, the pound should benefit from the faster vaccination process and a stronger second-quarter economic rebound.”
5. Facebook’s Australia Face-Off Could Backfire Across the Globe
Facebook’s dramatic move to block Australian news sharing escalated a broader battle against global regulation. World leaders were already watching Australian legislation expected to pass next week that will force tech titans Facebook and Alphabet Inc.’s Google to pay publishers for news content. But this week’s abrupt news blackout forced the issue onto the agenda of governments whose regulators are already ramping up scrutiny of the growing influence of Facebook and its ilk in spheres from media to artificial intelligence. Facebook drew a line in the sand precisely because it feared even larger markets would follow Australia’s lead. From Europe to the U.S. and China, governments are grappling with the issue of how to regulate the world’s largest internet giants, which have recently grown into trillion-dollar behemoths that help determine what billions of people view, discuss and consume on a daily basis.
6. Austria Regulator Sees Frauds Rising Amid Crypto ‘Hype’
Austria’s Financial Market Authority has seen a record in whistle-blower reports of potential fraud in 2020, with cryptocurrencies being a focus. Two-thirds of the investment fraud reports were related to crypto- and digital currencies trading products, while the rest was, among others, related to stocks and gold, FMA said in a statement. The regulator said it saw a rise in scam offerings for digital currencies on “dubious” platforms, which were often advertised on social media such as Facebook, WhatsApp, TikTok or Telegram.
7. India’s $3.5 Billion Zombie-Home Experiment Starts to Pay Off
A 250-billion-rupee ($3.5 billion) fund set up by India’s government to complete stalled housing projects is set to deliver its first finished apartments in 2021, offering a template for a problem that has washed out savings of thousands of home buyers and bankrupted developers. The fund will hand over some 16 projects or more than 4,000 homes in the financial year starting April 1. The ‘Special Window for Completion of Construction of Affordable and Mid-Income Housing Projects’ (SWAMIH) fund was announced in November 2019. At the time, India had an estimated $63 billion of such stalled projects as an economic slowdown and a credit crisis cascaded through the sector. Builders were unable to service their loans, forcing banks to write off the debts and worsen what was already one of the world’s biggest bad-loan piles.
8. Renault Warns of Rough Year After Record $9.7 Billion Loss
Renault SA braced investors for another challenging year as lingering coronavirus restrictions and supply-chain challenges threaten the French carmaker coming off a record annual deficit. The manufacturer reported a net loss of 8 billion euros ($9.7 billion) for 2020, worse than the 7.85 billion euro-deficit projected by analysts. Much of the damage was done during the first half when lockdowns crippled auto-shipments. “2021 is set to be difficult given the unknowns regarding the health crisis as well as electronic components supply shortages,” Chief Executive Officer Luca de Meo said Friday in a statement. “The priority is profitability and cash generation.”
9. U.S. Says It’s Willing to Meet With Iran to Restore Nuclear Deal
The Biden administration said it would be willing to meet with Iran to discuss a “diplomatic way forward” in efforts to return to the nuclear deal quit by President Donald Trump in 2018, a first step toward easing tensions. The offer is a politically risky effort by President Joe Biden to move beyond the standoff after a slew of U.S. sanctions cratered Iran’s economy and infuriated other world leaders, who argued that the 2015 accord and the inspections regime it created had reined in Tehran’s nuclear program.
10. Uber Loses U.K. Top Court Ruling on Drivers’ Employment Status
Uber lost a U.K. Supreme Court ruling over the rights of its drivers, in a landmark decision that threatens the company’s business model in the country. The judges said that Uber drivers are “workers” entitled to rights like minimum wage, holiday pay and rest breaks. The court said the contract terms were set by Uber and working conditions were controlled by the company. Uber drivers’ “working time is not limited to the period when driving passengers,” Judge George Leggatt said in a summary of the ruling. It also “includes any period when a driver is logged into the app and ready and willing to accept trips.” The ruling is the end of the road for Uber’s five-year fight over the status of its drivers and another setback for Uber in the U.K., which is home to the ride-sharing company’s largest European market. Last year, Uber had to fight to retain its license to operate in London after the transport regulator complained about safety concerns.
Curated from Bloomberg.com
