Major International Business Headlines Brief::: 05 February 2022

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Major International Business Headlines Brief::: 05 February 2022 

 


 

 


 <https://www.nedbank.co.zw/> 

 


 

 


ü  US jobs growth stronger than expected as economy shrugs off Omicron

ü  Can tourism ease the inflation pressure in Turkey?

ü  Bitcoin mimics stocks rally, hits 2-week high

ü  Ford to suspend or cut output at 8 of its factories due to chip shortage

ü  Emerging market investors dive for stocks amid Fed storm

ü  Wall St Week Ahead Inflation data next focus for investors after bond
yield spike

ü  Apple, Broadcom win new trial in $1.1 bln Caltech patent case

ü  Amazon surges with record $190 billion gain in value

ü  Fed to start rate hikes with a bang? Not likely

ü  Airbus may make engines for hydrogen fuelled planes, CEO tells paper

ü  Apple plans to debut low cost 5G iPhone in March - Bloomberg News

ü  Nasdaq regains ground after choppy week driven by big tech earnings

ü  J&J tried to get federal judge to block publication of Reuters story

ü  Amazon is exploring offer for Peloton, source says; report says Nike also
weighing bid

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 

US jobs growth stronger than expected as economy shrugs off Omicron

The US saw strong hiring last month, despite disruption caused by the
Omicron variant of coronavirus.

 

Employers added 467,000 jobs, the Labor Department said. That was far better
than analysts had predicted.

 

The jobless rate inched up from 3.9% in December to 4%, but that was due to
more people looking for work.

 

Analysts said the robust job creation was likely to add to the pressure on
the US central bank to raise interest rates next month.

 

The monthly survey also revised up its estimates for hiring in December,
providing more support for those who say the economy will remain strong even
as officials withdraw stimulus policies put in place at the start of the
pandemic in 2020.

 

"This is a big positive surprise," said Brian Coulton, chief economist at
Fitch Ratings. "It confirms that each successive wave of the virus is having
a smaller and smaller impact on activity and labour demand."

 

Federal Reserve chair Jerome Powell has said the bank is eyeing a rate
increase next month - which would be the first rise since 2018. The move is
intended to help curb price increases, by cooling demand with higher
borrowing costs.

 

The central bank is under pressure to rein in inflation, which is rising at
its fastest pace in nearly 40 years. In the UK, the Bank of England has
already raised interest rates twice in the past three months.

 

President Joe Biden, whose approval ratings have sagged amid widespread
concerns about inflation, acknowledged the cost-of-living pressures in
remarks celebrating the jobs figures.

 

He said his administration was working to address the issues, including by
encouraging investment in areas that have been hit by shortages, such as
microchips.

 

He also pushed Congress to move forward with his administration's currently
stalled spending proposals, which he said would provide relief through
programmes like subsidised childcare for families.

 

"We're still going to work on gas prices, we're still going to work on food
prices," he said. "In the meantime, there's a lot we can do to give these
families a little extra breathing room."

 

US businesses have reported widespread pressures due to increased materials
costs and higher wages- inflation economists say have been fuelled in part
by the wave of government stimulus that followed the pandemic.

 

The latest jobs report showed the average hourly wage has increased by 5.7%
over the last 12 months - a stark acceleration from the meagre gains seen in
recent years. However, the jump does not keep pace with the fast pace of
price increases hitting the economy.

 

Still, there are signs the pay gains are helping to lure people back into
the workforce. The share of people working or looking for work last month
exceeded 62% for the first time since the pandemic hit.

 

Women's participation has picked up especially in recent months, as schools
and nurseries reopen.

 

Restaurants and bars helped to drive the hiring in the US in January.
Retailers, warehouse and transportation businesses also added workers.

 

However, the report showed Omicron still took a toll. About six million
people said they did not work or saw their hours cut due to the pandemic -
almost double the prior month.-BBC

 

 

 

Can tourism ease the inflation pressure in Turkey?

Inflation is a battle people all over the world are fighting.

 

But the struggle is particularly acute in Turkey where people are finding it
increasingly difficult to make ends meet.

 

They are making tough decisions about what they can afford and how they
budget.

 

A mix of soaring inflation and a currency that's lost nearly half its value
has created a cost of living crisis in the country.

 

Inflation surged to 48.7% in January, after reaching 36% in December.

 

But some economists think the actual rate could be much higher.

 

"There are groups of academics who have come up with a technical measure of
inflation. Their measurement was close to 60% [in December]. This creates a
huge burden on society at large," said Durmus Yilmaz.

 

He served as Turkish central bank governor between 2006 and 2011, and is now
a member of the opposition party.

 

Unorthodox economic views

Just days before January's inflation data were released on Thursday,
President Recep Tayyip Erdogan fired Sait Erdal Dincer, the head of Turkey's
statistics agency.

 

Local media reported the decision was fuelled by the president's
dissatisfaction with a worsening economic situation, and a desire to seek
re-election next year.

 

In two weeks, Turkey's central bank will meet to discuss strategies for
easing the pain on households.

 

But policymakers are unlikely to pursue the usual method of cooling
inflation with higher interest rates.

 

That's because President Erdogan believes that higher rates cause inflation,
a view that runs contrary to conventional economic theory.

 

And in four of the past five months, he has directed the central bank to
instead cut rates.

 

Turkey cuts interest rates despite spiralling inflation

This week the president said that for "some time," people across the country
will have to "carry the burden" of inflation.

 

The high prices and depreciating currency have put a tight squeeze on
household budgets.

 

The price of red meat, for example, has soared so much, many families say
they can no longer afford it.

 

Those who can do so buy it less frequently or in smaller amounts.

 

In December, the lira's plunge forced grocery stores to re-price goods on
the shelf almost every day.

 

And one woman, Montoya, who goes to university in Istanbul, said she decided
to rent her extra bedroom to tourists to be able to make rent payments each
month.

 

"I'm really worried about it, because I'm really scared when someone comes
to me, and I don't know him or her.

 

"It's staying at home with someone I don't know.

 

"It's really scary, actually, but I can't do anything else. Yesterday I went
to the market and one bag is 300 lira. One month ago it was 150," she said.

 

Tourism boost?

The economic situation is growing more severe for those inside the country.

 

But a favourable exchange rate has made Turkey a more attractive holiday
destination for people in other parts of the world.

 

Before the coronavirus pandemic, in 2019 tourism brought $34bn (£25bn) into
Turkey.

 

And though lockdowns and travel restrictions pummelled the sector in 2020,
it bounced back in 2021.

 

Arrivals jumped 85.5%, though revenue was still a third lower than it was
pre-pandemic.

 

Sebnem Altin leads group tours across the country for the Grand Circle
Travel company.

 

She said there are bookings, but she believes the recovery is still fragile.

 

"This past season, people could just cancel their tours at the last minute
and agencies are quite flexible with it, which is something new.

 

"For that reason, even though we have bookings and everything looks really
beautifully rosy for the year coming up, we can never be sure that these
bookings will be realised.

 

"So I always have concerns and I'm not confident, I have to say," she said.

 

Tourism makes up about 13% of Turkey's overall economy.

 

The country was the sixth-most popular tourist destination in 2019,
according to the World Trade Organisation.

 

And, even then, it said the favourable exchange rate was a key factor in
attracting tourists.

 

If the industry continues to recover as travel restrictions continue to ease
this year, it could provide wider economic benefits for Turkey, according to
Roger Kelly, a lead regional economist at the European Bank for
Reconstruction and Development.

 

He said one of the underlying structural problems for the economy is the
nation's current account deficit, which means the value of goods and
services Turkey imports is more than exports.

 

More tourism revenue would help reduce that deficit, he said.

 

"Clearly, if you've got good tourism revenues coming in, this helps reduce
the current account deficit, which makes financing it straightforward, which
helps support the lira.

 

"It means your inflation problem is reduced, because a weaker lira helps to
feed inflation.

 

"So, from that perspective, if you have a reasonably strong tourism season,
this helps to support the lira and helps bring down inflation," Mr Kelly
said.-BBC

 

 

 

Bitcoin mimics stocks rally, hits 2-week high

(Reuters) - Bitcoin hit its highest in two weeks on Saturday, extending the
previous session's strong gains as cryptocurrencies basked in a recovery in
risk appetite and a rally in stock markets.

 

The world's largest cryptocurrency hit $41,983, taking gains from Thursday's
lows to nearly 16%, and marking a 27% rise from the year's low of $32,950.72
on Jan. 24.

 

Ether , the coin linked to the ethereum blockchain network, scaled the
$3,000 level for the first time since Jan. 21.

 

Friday's 11%-plus was the biggest single-day gain for bitcoin since
mid-June, and the first major bounce after weeks of being roiled, along with
technology and growth stocks, by fears of faster-than-expected Fed rate
hikes to curb a surge in inflation.

 

It came alongside a rally in U.S. stocks, with the tech-heavy Nasdaq (.IXIC)
ending the week with gains despite the heavy volatility from earnings,
including Amazon's robust growth and Facebook-owner Meta Platforms Inc's
(FB.O) disappointing results.

 

Those synchronised moves showed how bitcoin has become far more of a
mainstream asset, jolted by swings in risk-appetite.

 

"The current panic and volatility surrounding bitcoin is based on a
fundamental misunderstanding of it as an asset class," said Ed Hindi, chief
investment officer of Swiss-based cryptocurrency hedgefund Tyr Capital.

 

"When valuations on the Nasdaq fall, misguided institutional investors start
liquidating bitcoin positions en-masse as if it were a tech stock."

 

Bitcoin correlations

The recovery in stocks boosted other listed crypto assets on Friday, with
miner Riot Blockchain (RIOT.O) getting a bump after declaring bitcoin
production more than doubled in January from a year earlier.

 

Marathon Digital Holdings (MARA.O) rallied after reporting bitcoin
production increased, as did crypto exchange Coinbase Global (COIN.O), which
rose more than 7%.

 

The Thomson Reuters Trust Principles.

 

 

 

Ford to suspend or cut output at 8 of its factories due to chip shortage

(Reuters) - Ford Motor (F.N) plans to suspend or cut production at eight of
its factories in the United States, Mexico and Canada throughout next week
because of chip supply constraints, a spokeswoman told Reuters on Friday.

 

The changes come a day after the Detroit automaker warned a chip shortage
would lead to a decline to vehicle volume in the current quarter.

 

Production at factories in Michigan, Chicago and in Cuautitlan, Mexico will
be suspended. In Kansas City, production of its F-150 pickup trucks will be
idled while one shift will run for production of its Transit vans.

 

The Detroit automaker will also run a single shift or a reduced schedule at
its factories in Dearborn, Kentucky and Louisville, while removing overtime
at its Oakville factory in Canada.

 

All changes will be in place for the week beginning Feb. 7.

 

Ford shares slumped on Friday, after the automaker posted
smaller-than-expected quarterly income and forecast a slower recovery in
2022 vehicle production than rival General Motors (GM.N) read more

 

However, the company said it expected vehicle volume to improve
significantly in the second half.

 

The Thomson Reuters Trust Principles.

 

 

 

Emerging market investors dive for stocks amid Fed storm

(Reuters) - Developing world investors, buffeted by various "taper tantrums"
over the last decade, are now nervously watching as the rainmaker of global
markets - the U.S. Federal Reserve - readies its most aggressive rate hike
cycle in 17 years.

 

More hot jobs data on Friday drove the benchmark for world borrowing costs,
the 10-year U.S. Treasury yield , to its highest level in two years,
prompting yet more gnashing of teeth among emerging market money managers
already having a tough year.

 

Deutsche Bank's analysts point out that while some currencies managed to
save face here and there, anyone who took the approach of hedging forex risk
would have seen only one year that started worse than this one since 2010.

 

Fed tightening has not been bad news for all EM assets though.

 

EM stocks measured by MSCI's 25-country MSCIEF (.MSCIEF) are flat for the
year, which means they have done 5% better than their developed market peers
(.MIWO00000PUS), which is something of a pattern according to Morgan
Stanley's analysts.

 

"The outperformance of EM (stocks) after the first (Fed) hike is notable,"
they said, noting that in Fed hike cycles since 1980, the MSCIEF has been up
17% on average six months after the first rate increase is delivered.

 

Morgan Stanley analysts have not yet made the call to "buy EM," but they say
"it suggests that the time to get more bullish on EM may be approaching."

 

The massive outperformance from Latin American stocks in January could be a
harbinger of more EM gains.

 

EM stocks vs U.S. rates

One silver lining in last year's rout of Chinese stock markets is that many
investors think they have a good chance of rebounding this year with
authorities there now providing support to the economy again.

 

Swiss-based European fund heavyweight Pictet upgraded its view on Chinese
stocks to "positive" this week on the basis of that support, and because
they would probably be a good hedge in the event of a full-blown
Russia-Ukraine military conflict.

 

"Chinese equities could recoup last year’s declines and narrow the valuation
gap with their counterparts in the coming months," the firm's chief
strategist, Luca Paolini, said.

 

However, a more aggressive tightening cycle by the Fed and other top central
banks could quickly reignite bond market pressures, said JPMorgan's head of
emerging market local markets and sovereign debt strategy, Jonny Goulden.

 

The "taper tantrum" shock of 2013-14, when the prospect of a reduction in
post-financial crisis support from the Fed hit emerging market assets hard,
still haunts EM veterans.

 

Returns on JPMorgan's hard currency emerging markets bond index EMBI Global
Diversified (.JPMEGDR) are -2.6% since the start of the year, while those
for the local currency fixed income benchmark (.JGEGDCM) are at 1%.

 

"The Fed tightening cycle remains the focus for EM, but so far this year
these pressures are curiously materializing in credit rather than local
markets," Goulden said in a note to clients on Friday.

 

"We would normally expect these forces to drive greater dollar strength, but
EM FX (year-to-date) spot returns are +1%."

 

Data on capital flows backed up this trend, Goulden added, saying short-term
fund flows had also shifted with emerging market local bond funds pulling in
more than $1 billion while hard-currency funds suffered $2.3 billion of
outflows to start 2022.

 

Deutsche Bank said since 2013 Mexico, Poland, the Philippines and Hungary
are the EMs with the highest correlation to rising U.S. yields, when looking
at their local 10-year benchmarks.

 

"During large moves, we find that all countries (but China) have provided
negative returns during periods of extreme bearish moves in U.S.
Treasuries," Deutsche's analysts said, showing that bonds from Turkey, the
Philippines, Mexico and Peru posted the biggest losses.

 

Given their expectation of a U.S. 10-year yield at 2.25% by the end of next
month, DB analysts imply a forex-hedged return for EM fixed income that
would actually outperform Treasuries on a "total return" basis which takes
into account any currency move.

 

"However, this would still not necessarily be a strong buying argument at
this point in time," they said. "We recommend that despite the recent
underperformance, investors maintain a more cautious approach on the asset
class."

 

The Thomson Reuters Trust Principles.

 

 

 

Wall St Week Ahead Inflation data next focus for investors after bond yield
spike

(Reuters) - Wild swings in stocks and a sharp run-up in government bond
yields are putting the spotlight on next week’s U.S. inflation data, as
investors brace for more volatility across assets.

 

A turbulent week in markets ended with a surge in Treasury yields to their
highest level in more than two years after surprisingly strong U.S. jobs
data stoked expectations of a more hawkish Federal Reserve.

 

Robust data on inflation – which hit its highest annual level in nearly four
decades in December – could further bolster the case for a more aggressive
Fed and extend the climb in yields, dulling the allure of an equity market
struggling to rebound from last month’s tumble.

 

Due out on Thursday, the U.S. consumer price index for January is expected
to have risen 0.5%, culminating in an annual rise of 7.3%, which would be
the largest such increase since 1982, according to a Reuters poll.

 

“We could potentially get a very difficult number to digest next week on the
inflation front and that has the potential to cut the markets off at the
knees,” said Jack Ablin, chief investment officer at Cresset Capital
Management.

 

The yield on the benchmark 10-year U.S. Treasury note, which moves inversely
to prices, has climbed about 40 basis points in 2022 to over 1.9% as
investors factor in at least five rate increases from the Fed this year.

 

The climb has weighed on equities overall while contributing to steep
declines in the shares of many tech and growth stocks, whose valuations rely
on future profits that are discounted more steeply as bond yields rise. The
benchmark S&P 500 (.SPX) is down about 5.6% so far to start the year, with
the tech-heavy Nasdaq (.IXIC) logging a nearly 10% drop.

 

“The reason why people are hitting the reset button ... is because
valuations were pulled forward a lot," said King Lip, chief strategist at
Baker Avenue Asset Management. "With rising rates, the valuations just can’t
be justified. So whenever there is a little bit of a miss (on earnings) is
when these stocks get punished quite a bit."

 

The forward price-to-earnings ratio for the S&P 500 has fallen to 19.5 times
from 21.7 times at the end of 2021, while the forward P/E for the S&P 500
tech sector (.SPLRCT) has dropped to 24.4 from 28.5, according to Refinitiv
Datastream.

 

Some investors believe stocks have further to fall before they become
attractive. Analysts at Morgan Stanley on Friday urged clients to sell into
equity rallies as “a tightening Fed historically brings lower returns and
great uncertainty for equities” and wrote that the S&P 500’s fair value is
closer to 4,000. The benchmark index on Friday rose around 0.5% to 4,500.

 

Others are questioning whether the growth stocks that have led the markets
higher for years are ceding leadership to so-called value stocks,
comparatively cheap stocks that are expected to do better in a rising rate
or inflationary environment.

 

The S&P 500 value index (.IVX), replete with shares of energy firms,
financial companies and other economically sensitive names, had declined
1.4% so far this year as of Thursday, versus a 10.2% drop for its S&P 500
growth counterpart (.IGX). That disparity would be close to value's biggest
annual outperformance over growth in two decades.

 

"You are seeing gradually higher market interest rates that is causing
investors to reassess and to look at near-term profitability and the value
and cyclical trade," said John Lynch, chief investment officer for Comerica
Wealth Management.

 

The market was also digesting a topsy-turvy week of high-profile earnings.
Shares of Google parent Alphabet Inc (GOOGL.O) and Amazon.com Inc soared
after their respective quarterly reports while megacap peer Meta Platforms
Inc (FB.O) tumbled after the Facebook owner's dour forecast.

 

Next week, reports are due from Walt Disney Co (DIS.N), Coca-Cola (KO.N) and
Twitter Inc (TWTR.N), with Nvidia Corp (NVDA.O) set to report the following
week.

 

As with Meta Platforms, any disappointments in reports - especially from
companies whose valuations remain expensive - could result in severe market
fallout, investors said.

 

"It’s been a volatile start to the year with investors swinging between
concerns over Federal Reserve tightening and confidence in the economic
recovery," Art Hogan, chief market strategist at National Securities, said
in a research note. "Meta aside, a solid earnings outlook is helping to ease
the uncertainty, at least for the moment."

 

The Thomson Reuters Trust Principles.

 

 

Apple, Broadcom win new trial in $1.1 bln Caltech patent case

(Reuters) - A U.S. appeals court on Friday threw out a jury verdict ordering
Apple Inc (AAPL.O) and Broadcom Inc (AVGO.O) to pay $1.1 billion to the
California Institute of Technology for infringing its Wi-Fi technology
patents, and ordered a new trial on damages.

 

The U.S. Court of Appeals for the Federal Circuit said the January 2020
award by the federal jury in Los Angeles, one of the largest ever in patent
cases, was "legally unsupportable."

 

It also upheld the jury's findings that Apple and Broadcom infringed two
Caltech patents, and ordered a new trial on whether they infringed a third
patent.

 

Caltech had sued Apple and Broadcom in May 2016, alleging that millions of
iPhones, iPads, Apple Watches and other devices using Broadcom chips
infringed its data-transmission patents.

 

The jury had ordered Apple to pay Caltech $837.8 million and Broadcom to pay
an additional $270.2 million.

 

Caltech spokeswoman Shayna Chabner said the Pasadena, California-based
school was confident that the value of its patents would be "fully
recognized" at a new damages trial.

 

Neither Apple nor Broadcom immediately responded to requests for comment.

 

Apple is a major purchaser of Broadcom chips, and in January 2020 reached a
$15 billion supply agreement that ends in 2023. Broadcom has estimated that
20% of its revenue comes from Apple.

 

Caltech's damages model had been based on an argument that the school could
have simultaneously negotiated a license with Apple for devices containing
Broadcom chips, and a license with Broadcom for chips used elsewhere.

 

Writing for the appeals court, Circuit Judge Richard Linn rejected that
theory.

 

"The mere fact that Broadcom and Apple are separate infringers alone does
not support treating the same chips differently at different stages in the
supply chain," Linn wrote. "Caltech's two-tier damages theory is legally
unsupportable on this record."

 

Caltech has also sued Microsoft Corp (MSFT.O), Samsung Electronics Co
(005930.KS), Dell Technologies Inc (DELL.N) and HP Inc (HPQ.N) for alleged
infringement of the same patents. Those cases are pending.

 

The Thomson Reuters Trust Principles.

 

 

 

Amazon surges with record $190 billion gain in value

(Reuters) - A day after Facebook owner Meta Platforms (FB.O) suffered the
deepest loss of stock market value in history for a U.S. company, Amazon
logged the greatest ever one-day increase in value.

 

Shares of the online retail and cloud computing giant surged 13.5% on Friday
following its blowout quarterly report, expanding its market capitalization
by around $190 billion by the end of trading.

 

That beat Apple Inc's (AAPL.O) record $181 billion one-day gain in stock
market value on Jan. 28 following the iPhone maker's own blockbuster
quarterly report, according to Refinitiv data.

 

Amazon is now valued at about $1.6 trillion. With Meta Platforms' stock
slipping 0.3% on Friday, its value stood at about $660 billion.

 

Amazon's shares jumped after the company reported better-than-expected
profits late on Thursday and said it was hiking the price of its annual U.S.
Prime subscriptions by 17%. read more

 

Amazon's surge comes a day after Meta Platforms' stock market value plunged
more than $200 billion in the biggest single-day loss for a U.S. company
after the social media giant issued a dismal forecast. read more

 

"After fighting the post-lockdown blues in 2021, we believe Amazon's
fortunes have the potential to improve as 2022 unfolds," Monness Crespi
Hardt analyst Brian White wrote in a research note. "Amazon is uniquely
positioned to exit this crisis as one of the biggest beneficiaries of
accelerated digital transformation."

 

Retail investors appeared to use Amazon's rally to take profits. Data on
Fidelity's website showed Amazon was the most traded stock among its
customers on Friday, with sell orders outnumbering buy orders by more than
two to one.

 

The size of the increase in Amazon's value eclipsed the market
capitalizations of companies including AT&T Inc (T.N), Morgan Stanley (MS.N)
and Netflix Inc .

 

Apple, Microsoft Corp (MSFT.O) and Google owner Alphabet Inc (GOOGL.O)
remain Wall Street's most valuable companies, with market capitalizations of
$2.8 trillion, $2.3 trillion and $1.9 trillion, respectively, according to
Refinitiv.

 

Amazon's stock price remains down around 15% from its record high close of
$3,731.41 in July.

 

The Thomson Reuters Trust Principles.

 

 

Fed to start rate hikes with a bang? Not likely

(Reuters) - Bigger-than-expected U.S. job gains last month are fueling
market bets that the Federal Reserve will kick off its interest rate hikes
in March with a hefty half-point jump.

 

That's likely a bridge too far, given what Fed policymakers have said, where
the jobs market is now, and what history suggests. But they do cement
expectations that the Fed will raise rates at most of its remaining seven
meetings this year as it moves to battle high inflation without undermining
the labor market recovery.

 

Interest-rate futures traders largely expect Fed policymakers to raise the
target range of the overnight borrowing rate between banks by a
quarter-of-a-percentage point, to 0.25%-0.50%. But they are also pricing in
a 31% chance of a bigger, half-point rate hike

 

That's up from about a 13% chance priced in before the U.S. Bureau of Labor
Statistics reported employers added 467,000 jobs in January. The job gains
surpassed even the most optimistic of economist estimates in a Reuters poll;
most had expected that the surge in COVID-19 cases would dent demand for
workers. read more

 

But the report suggested the opposite, as average hourly wages rose 5.7%
from a year earlier, and the number of people employed or looking for work
increased, a metric closely watched as a sign of labor market health. There
are still 2.8 million fewer jobs than before the pandemic hit the U.S.
economy in March 2020, but the jobs gap is narrowing steadily.

 

Since the 1990s, when the Fed is considered to have largely tamed inflation,
50 basis-point hikes have been the exception and have never been used to
start a tightening cycle.

 

To St. Louis Federal Reserve President James Bullard, one of the Fed's most
strident supporters of earlier and faster policy tightening, it wasn't clear
what starting with a bigger bang would accomplish.

 

Since late last year markets have been tightening financial market
conditions on their own, anticipating Fed actions that have not been taken
yet. The yield on the benchmark 10-year Treasury note rose Friday to 1.9%,
the highest it's been in over two years.

 

At this point "It is not clear what you are buying with a 50 basis point
move," Bullard told Reuters Tuesday. "In a way we have done a lot of the
work already and I am not sure it behooves us to do a dramatic funds rate
increase" in March.

 

But the January data might cause the Fed to reassess somewhat. Policymakers
had expected the recent surge of coronavirus cases to at least slow hiring.
Instead the economy powered through and wages continued rising.

 

Labor force participation, which the Fed had worried might be permanently
stuck low, rose to 62.2%.

 

Several industries, including transportation and retail, today employ more
people than they did before the pandemic, though the workforce in the
leisure and hospitality industry - hit harder than other sectors - remains
10% below its pre-pandemic level.

 

The strong January hiring - along with big upward revisions for past months
- "completely changes the narrative about the labor market and the broader
economy," writes Jefferies' Aneta Markowska.

 

"What looked like a summer surge followed by a winter freeze, now looks like
a very steady growth momentum that's not abating at all," Markowska wrote.
That could signal the Fed may need to continue its tightening cycle well
into 2023 and even 2024 to keep a grip on inflation, she said. Others
agreed.

 

"We still think that a slowdown in first-quarter GDP growth will persuade
officials to start slow, although they could project a bigger cumulative
tightening over the next few years," economists at Capital Economics said
after the jobs report.

 

The Thomson Reuters Trust Principles.

 

 

 

Airbus may make engines for hydrogen fuelled planes, CEO tells paper

(Reuters) - Airbus (AIR.PA) may make its own engines for its hydrogen
fuelled planes, Chief Executive Officer Guillaume Faury told a German
newspaper in an interview published on Saturday.

 

The planemaker has said it plans to develop the world's first zero-emission
hydrogen fuelled commercial aircraft by 2035.

 

Faury told the Welt am Sonntag newspaper that he could imagine equipping
those aircraft with electric motors produced in-house.

 

"That's something we could basically do ourselves," Faury was quoted as
saying, speaking of a possible "change of strategy".

 

The Thomson Reuters Trust Principles.

 

 

 

Apple plans to debut low cost 5G iPhone in March - Bloomberg News

(Reuters) - Apple Inc (AAPL.O) is targeting a date on or near March 8 to
unveil a low-cost 5G iPhone and an updated iPad, Bloomberg News reported on
Friday, citing people with knowledge of the matter.

 

According to the report, the new iPhone will be the first update to the
iPhone SE model in two years and will feature 5G network capabilities, an
improved camera and a faster processor.

 

Apple in October announced two new MacBook Pro models that run on more
powerful in-house chips.

 

With the expected launch still more than a month away, Apple's plans may
change in the face of production delays or other changes, the report added.

 

The company did not immediately respond to a Reuters request for comment.
read more

 

Cupertino, California-based Apple is overcoming the costly global shortage
in computer chips and posted record sales over the holiday quarter in
January, beating profit estimates and forecasting that its shortfall is
narrowing. read more

 

The Thomson Reuters Trust Principles.

 

 

 

Nasdaq regains ground after choppy week driven by big tech earnings

(Reuters) - Another bumpy ride on Wall Street ended on Friday as Amazon's
positive earnings capped a run of mixed big-tech numbers, with the Nasdaq
recovering much of its losses from the previous session and all three
benchmarks ending the week in positive territory.

 

Results from megacap growth stocks have dictated market moves this week, as
investors seek out tangible data to support sky-high valuations.

 

Amazon.com Inc jumped 13.5% after reporting robust earnings in the holiday
quarter. The gain expanded its market capitalization by around $190 billion,
the largest ever single-day increase in value of a U.S. company. read more

 

This came a day after Facebook-owner Meta Platforms Inc's (FB.O)
disappointing results shook markets and wiped more than $200 billion off its
valuation, the deepest loss of stock market value in history by a U.S.
company. read more

 

"These are eye-watering, stomach churning moves normally associated with
penny stocks, and yet they are happening in companies with billion-dollar
market caps," said Michael Hewson, chief market analyst at CMC Markets UK.

 

Despite the earnings-driven whiplash in technology stocks, all three major
stock indexes ended their first week of February higher, with the indexes
posting their second week of gains in a row.

 

While Meta lost another 0.3% on Friday, other social media companies which
had been dragged down with the Facebook owner rebounded strongly as they
posted estimate-beating earnings of their own.

 

Among them was Snap Inc (SNAP.N), surging 58.8% after reporting
better-than-expected fourth-quarter user growth and outlook. read more

 

Pinterest Inc (PINS.N)also jumped 11.2% after its quarterly revenue beat
estimates as retailers splurged on advertising during the holiday quarter.
read more

 

The Dow Jones Industrial Average (.DJI) fell 21.42 points, or 0.06%, to
35,089.74, the S&P 500 (.SPX) gained 23.09 points, or 0.52%, to 4,500.53 and
the Nasdaq Composite (.IXIC) added 219.19 points, or 1.58%, to 14,098.01.

 

A 'Wall St' sign is seen above two 'One Way' signs in New York August 24,
2015. REUTERS/Lucas Jackson/File Photo

Among the major S&P 500 sectors which advanced, energy stocks (.SPNY) hit
their highest since 2018 as crude prices touched a seven-year peak.

 

Hess Corp (HES.N) was the largest gainer in the sector, jumping 4% to its
highest close since September 2014. Occidental Petroleum Corp gained 2%,
with its shares ending at levels last seen in February 2020.

 

Consumer discretionary (.SPLRCD) was the leading sector though, up 3.7% as
it was bolstered by Amazon's performance. The tech behemoth's gains helped
alleviate the drag of Ford Motor Co (F.N), which slumped 9.7% after the
automaker posted disappointing quarterly numbers. read more

 

The Labor Department's closely watched employment report showed nonfarm
payrolls increased by 467,000 jobs last month, compared with the 150,000
jobs addition forecast by economists polled by Reuters. read more

 

The data for December was revised higher to show 510,000 jobs created,
instead of the previously reported 199,000.

 

Fears of faster-than-expected rate hikes to curb a surge in inflation have
haunted markets since the beginning of the year, with growth stocks such as
technology feeling the brunt of that as investors pivot towards current cash
flow from betting on future expectations.

 

"A lot of the high-valuation stuff is going to continue to have trouble and
it's already gotten smacked down a lot," said Louis Ricci, head of trading
at Emles Advisors.

 

"To us, this jobs report was affirmation that, yes, stocks are going to be
jittery and there's going to be a lot of volatility."

 

However, the rate hike prospect has boosted U.S. Treasuries, with yields on
the 10-year benchmark hitting their highest levels since December 2019, in
the wake of the payrolls data. This is regarded as positive for financials,
with Bank of America Corp (BAC.N), Morgan Stanley (MS.N) and Wells Fargo &
Co all gaining between 1.8% and 4% on Friday.

 

Volume on U.S. exchanges was 11.07 billion shares, compared with the 12.37
billion average for the full session over the last 20 trading days.

 

The S&P 500 posted 26 new 52-week highs and 11 new lows; the Nasdaq
Composite recorded 36 new highs and 196 new lows.

 

The Thomson Reuters Trust Principles.

 

 

 

J&J tried to get federal judge to block publication of Reuters story

(Reuters) - Johnson & Johnson tried to get a U.S. judge to block Reuters
from publishing a story based on what it said were confidential company
documents about the healthcare giant's legal maneuvers to fight lawsuits
claiming its Baby Powder caused cancer.

 

"The First Amendment is not a license to knowingly violate the law," said
the company in a filing late Thursday in U.S. Bankruptcy Court in New
Jersey, where a unit of J&J had sought bankruptcy protection while defending
the Baby Powder lawsuits. The First Amendment of the U.S. Constitution
protects freedom of the press.

 

On Friday, Reuters reported that J&J secretly launched "Project Plato" last
year to shift liability from about 38,000 pending Baby Powder talc lawsuits
to a newly created subsidiary, which was then to be put into bankruptcy. By
doing so, J&J could limit its financial exposure to the lawsuits.

 

After the publication of the story, Reuters asked U.S. Bankruptcy Judge
Michael Kaplan to deny J&J's motion, claiming it was moot. Less than an hour
after Reuters submitted its letter, J&J said in a filing that it was
withdrawing a request for an immediate hearing on the matter but was "not
prepared to agree" that its request regarding the documents was moot.

 

J&J said in its filing after the publication of the story that it intends to
continue discussions with Reuters and said it was "heartened that
publication of confidential documents may no longer be imminent."

 

J&J's request to block publication was "among the most extraordinary
remedies a litigant can request under the law," attorneys for Reuters, a
unit of Thomson Reuters , said in a Friday court filing. The news agency's
lawyers called J&J's request a "prior restraint of speech on a matter of
public interest."

 

J&J said Reuters had obtained documents that were protected from public
disclosure by an order from Kaplan. The company demanded that Reuters return
the documents and refrain from publishing information gleaned from the
documents.

 

"This is a complex matter that should be heard by the court – in a forum
where both sides present their cases in an appropriate setting – and not
argued through the media," a J&J spokesperson said in a statement on Friday.

 

Reuters denied that it has confidential information, saying in court papers
that the confidentiality of one of the documents was lifted in January and
that the second is not in the possession of Reuters.

 

J&J's (JNJ.N) LTL unit filed for bankruptcy in October to resolve the claims
alleging J&J's talc-based products contained asbestos and caused
mesothelioma and ovarian cancer. read more

 

J&J maintains that its consumer talc products are safe and have been
confirmed to be asbestos-free.

 

The company has said it placed LTL into bankruptcy to settle those claims
rather than litigating them individually. It has said resolving these claims
through Chapter 11 is a legitimate use of the restructuring process.

 

Talc plaintiff committees argue that J&J should not be permitted to use
bankruptcy to address the talc litigation and that by doing so, it is
depriving plaintiffs their day in court.

 

The Thomson Reuters Trust Principles.

 

 

 

Amazon is exploring offer for Peloton, source says; report says Nike also
weighing bid

(Reuters) - Peloton Interactive Inc (PTON.O) has drawn interest from
potential buyers including e-commerce giant Amazon.com Inc , according to a
person familiar with the matter, as the exercise bike maker struggles to
maintain pandemic-fueled growth.

 

Shares of Peloton surged 30% in extended trading on the news, which comes
days after activist investor Blackwells Capital urged the company's board to
put it up for sale.

 

Amazon is exploring an offer for Peloton and is speaking with advisers about
whether and how to proceed, a source said. Peloton has not yet decided
whether it will explore a sale, according to the source.

 

Meanwhile, the Financial Times reported late on Friday that sportswear
company NikeInc is also evaluating a bid for Peloton, citing people briefed
on the matter, who said the considerations are preliminary and Nike has not
held talks with Peloton.

 

Peloton and Nike did not immediately respond to a Reuters request for
comment, while Amazon declined to comment.

 

Peloton's sales boomed during COVID-19 lockdowns, with many snapping up home
fitness equipment. But its fortunes began to fade as vaccinations increased,
gyms reopened and rivals offered competitive products.

 

In November, it hinted that demand for its exercise bikes and treadmills was
slowing faster than expected, and its market capitalization since then has
shrunk to about $8 billion from a peak of nearly $52 billion in early 2021.

 

If the stock's gains hold on Monday, Peloton could reach the $10 billion
market-capitalization threshold.

 

Last week, Blackwells Capital called on the board of Peloton to remove CEO
John Foley immediately, accusing him of deals that set high fixed costs and
for holding on to excessive inventory, while misleading investors about the
need to raise capital. read more

 

Blackwells criticized Foley for hiring his wife as a key executive and
committing to a 300,000-square-foot, 20-year lease for office space in New
York, among other things.

 

The investment firm, run by Jason Aintabi, has also urged the board to put
the company up for sale to a buyer like Walt Disney Co (DIS.N), Apple Inc
(AAPL.O), Sony Group (6758.T) or Nike Inc , Reuters reported on Sunday. read
more

 

Peloton has tried to cushion the blow to its growth by cutting the price of
its popular bike and ramping up its ad spending, but growth remains
stagnant.

 

Last month, Peloton said the company was reviewing the size of its workforce
and "resetting" production levels, following a report that it was
temporarily halting production of connected fitness bikes and treadmills
after a significant drop in demand. read more

 

While many investors have become frustrated with Peloton due to a steep drop
in its share price, analysts also note that the company may be a difficult
acquisition target because of its two classes of stock, effectively allowing
insiders to control it.

 

The news was first reported by the Wall Street Journal.
(https://on.wsj.com/3AVMIf7)

 

The growth in the fitness band market has prompted tech giants such as Apple
Inc (AAPL.O) and Samsung (005930.KS) to introduce features for health
tracking, including electrocardiogram and blood pressure sensor. Alphabet
Inc-owned Google (GOOGL.O) closed its acquisition of fitness tracking
company Fitbit Inc in January.

 

Tech giants including Amazon and Alphabet have also seen a rise in their
valuation after blockbuster results this week. A day after Facebook owner
Meta Platforms (FB.O) suffered the deepest loss of stock market value in
history for a U.S. company, Amazon logged the greatest ever one-day increase
in value. read more

 

The Thomson Reuters Trust Principles.

 

 

 

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2022

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


ART

PPC

 

 


Starafrica

Fidelity

Turnall

 


Medtech

Zimre

Nampak Zimbabwe

 


 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 


DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
Faith Capital (Pvt) Ltd for general information purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy or
subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
contents or otherwise arising in connection therewith. Recipients of this
report shall be solely responsible for making their own independent
investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and sourced from third parties.

 


 

 


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<mailto:info at bulls.co.zw> info at bulls.co.zw Tel: +263 4 2927658 Cell: +263 77
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