1. Stocks, Futures Set Bullish Tone as Pound Rises
Stocks started off the week in a sea of green as investors took comfort from further stimulus bill negotiations and the impending deployment of the first vaccine in the U.S. S&P 500 futures gained about 0.7%, with the first deliveries of the Pfizer-BioNTech vaccine in the U.S. due to arrive Monday morning. A bipartisan group of lawmakers is set to unveil a $908 billion pandemic relief bill, although there is “no guarantee” Congress will pass it. European shares got a boost after the EU’s chief Brexit negotiator told a private meeting of ambassadors that a trade deal with the U.K. could come as soon as this week. The pound jumped by the most in almost two months.
Futures on the S&P 500 Index rose 0.7% as of early morning New York time.
The Stoxx Europe 600 Index jumped 0.8%.
The MSCI Asia Pacific Index increased 0.2%.
The MSCI Emerging Market Index decreased 0.1%.
2. Tech Firms Risk EU Fines Up to 10% of Sales in Bid to Curb Power
Tech giants deemed to be gatekeepers could face fines as high as 10% of annual revenue if they don’t comply with new European Union rules on data usage to be unveiled Tuesday. Companies that could include Google, Amazon.com and Apple will be banned from using any data from business users to compete with them or from treating their own services more favourably in rankings, among other obligations. A company that “systemically infringes” the obligations could face orders by the European Commission to make behavioural and structural changes, such as divesting businesses. Companies will be considered to be in systematic non-compliance if the EU has issued at least three fines within a period of five years.
3. Google Services Including Gmail, YouTube Suffer Major Outage
Services from Alphabet Inc.’s Google experienced widespread outages around the world, preventing people from accessing Gmail, YouTube and other products. Errors ranged from “something went wrong” on YouTube, to “there was an error. Please try again later,” when attempting to log into the company’s mail product from about 6:30 a.m. in New York. Google tools were failing to load for users in the U.S., the U.K. and across Europe, but began functioning again for many people after about an hour. Google confirmed there was an outage for the majority of its services according to a Workspace Status Dashboard, which monitors the health of its products. Later, it said functionality was restored to the “vast majority” of users.
4. Europe Hit With Tougher Virus Curbs Ahead of Vaccine Rollout
Europe is sharpening curbs on people and businesses to slow the rapid spread of the coronavirus, risking another knock to battered economies even with the rollout of a vaccine tantalizingly close. With months of pandemic fighting ahead, authorities are tightening measures without resorting to the strict curbs that triggered a collapse in business activity in the spring. Following record daily cases and deaths on Friday, Germany is urging, but not requiring, employers to close workplaces as it starts a hard lockdown on Wednesday. Italy and the Netherlands are among the countries expected to sharpen restrictions as well.
5. China Fines Alibaba, Tencent Unit Under Anti-Monopoly Laws
China’s antitrust watchdog fined Alibaba Group Holding and a Tencent Holdings unit over a pair of years-old acquisitions and said it’s reviewing an impending Tencent-led merger, signalling Beijing’s intention to tighten oversight of internet sector deals. The State Administration for Market Regulation said Monday it’s reviewing the combination of DouYu International Holdings Ltd. with Huya Inc., which could create a Chinese game streaming leader akin to Amazon’s Twitch. It fined Alibaba 500,000 yuan ($76,500) for failing to seek approval before increasing its stake in department store chain Intime Retail Group Co. to 73.79% in 2017, while China Literature Ltd., the e-books business spun off by Tencent, was also censured over a previous deal, according to a statement.
6. U.S. Government Agencies Hit by Suspected Russian Hackers
In one of the most audacious hacks in recent memory, U.S. government agencies were attacked as part of a global campaign that exploited a flaw in the software updates of a U.S. company. The hackers are suspected to be part of a notorious hacking group tied to the Russian government. The attack included breaches in the U.S. Treasury and Commerce departments and those of other government agencies in an attack that started months ago. The same hacking group is also believed to be behind the recent attack on the cyber-security firm FireEye Inc.
7. Barnier Tells EU Envoys Deal Could Come This Week: Brexit Update
The European Union’s chief negotiator, Michel Barnier, told a private meeting of ambassadors that a trade deal with the U.K. could be completed as soon as this week, but there are still significant differences to be bridged. The U.K. has made concessions on the level playing field and is now pushing the bloc to soften its demands on fisheries, Barnier told envoys from the EU’s 27 member states on Monday, according to two diplomats with knowledge of the meeting. A compromise on the latter subject could unlock the accord, Barnier said.
8. Rapid China Inflows Spur Call for Strongest Yuan Since 1993
The unrelenting pace of inflows heading for China’s bonds and stocks has one yuan bull predicting the currency could strengthen to a level not seen in nearly three decades. A “flood” of foreign cash will chase yuan-denominated assets in 2021 because they’ll offer far better yield than the rest of the world. He predicts the currency could rally 10% or even more by the end of next year. The yuan hasn’t been that strong since late 1993, just before China’s unification of official and market exchange rates triggered a plunge in the currency.
9. Dubai Business Conditions Worsen as Pandemic Weighs on Demand
Business activity in Dubai dropped for a second month in November as the coronavirus pandemic continued to weigh on demand. The non-oil private sector economy in the Middle East’s business hub deteriorated last month to the lowest since May. Its Purchasing Managers’ Index dipped to 49 from 49.9 in October, falling further below the 50 mark that separates growth from contraction. Employment figures continued to stabilize after having dipped to the lowest on record earlier this year and the pace of job losses was the mildest seen in nine months, though a possible lapse in demand could lead to another setback for employment in the short-term, the report said.
10. Adidas Plans to Sell Reebok by Early March 2021
Adidas has begun a review of whether to sell its Reebok brand, part of the development of the German sports company’s new five-year strategy. Adidas will announce a decision on March 10, when it presents its new plan, the company said Monday. The company acquired Reebok for $3.8 billion in 2006 and in recent years returned the division to profitability and growth. Adidas was exploring a sale and might start a strategic review in October. Private-equity firms Permira and Triton have looked at acquiring Reebok, though any plans are at an exploratory stage and may not ripen into an offer. Other interested parties include VF Corp., which owns the Timberland and North Face brands, as well as China’s Anta International Group Holdings.
