Public Markets 8-Hour Briefing
×Market Volatility Intensifies
European shares are heading for their steepest weekly decline since April as the war in Iran shows no sign of nearing a resolution. Emerging-market equities and currencies are set for their biggest weekly declines since the Covid pandemic started six years ago as volatility spikes across global markets. Asian stocks are under pressure from elevated oil prices and semiconductor woes, with overseas investors pulling money out of emerging Asian stocks at the fastest pace in nearly four years.
Oil Market Disruption
Oil prices retreated while Asian equities were mixed at the end of a volatile week as investor sentiment continues to be undermined by the conflict in the Middle East. US gasoline pump prices advanced to the highest level at any time under President Donald Trump, with the conflict disrupting energy supplies. Strait of Hormuz shipping has ground to a near-complete halt, with no oil shipments going through in the past 24 hours, as the Middle East war disrupts the vital waterway.
Corporate Earnings & Deals
Burlington Stores reported higher fiscal fourth-quarter profit as concerns about inflation and the economy drove consumers to off-price retailers. Axel Springer has bought the Telegraph in a £575 million deal, gatecrashing a proposed acquisition by the owner of the Daily Mail. DHL shares rose after Barclays upgraded to "overweight" and raised the price target by 26%.
Defense & Security
Defense firm Vincorion is planning to list in Frankfurt, looking to tap investor appetite for defense stocks in an increasingly unstable world. Missile interceptor shortage worries are flaring in world capitals as drones and missiles target cities and critical infrastructure in Ukraine and the Gulf. Israel has launched a "broad" wave of attacks on Tehran as tensions continue to escalate.
Regional Market Impact
US stocks have flipped the script for international investors since war erupted in the Mideast, handily outpacing the rest of the world after trailing their global peers badly last month. Chinese markets have held up better than their Asian peers during the global market selloff caused by the war in Iran. Gulf markets are being hit by the conflict, with investors factoring in new dangers across the region.
Economic Policy & Central Banks
Turkey has spent $12 billion to keep the lira stable during a week of global market volatility triggered by the war in Iran. Poland will likely abstain from interest-rate cuts for as long as the armed conflict in Iran lasts, according to a policymaker. The Philippine Central Bank Governor warns that oil rising toward $100 per barrel could push Philippine inflation beyond the BSP's 2%-4% target range.
Technology & Innovation
Embraer reported fourth-quarter revenue of 14.3 billion reais ($2.7 and adjusted earnings before interest, taxes, depreciation and amortization of 1.6 billion reais, beating analyst estimates. China has approved a new obesity treatment from Pfizer Inc., heightening competition in a market poised to become even more crowded with the looming entry of generics.
Trade & Supply Chains
Maersk and Hapag-Lloyd temporarily halted key shipping lanes amid the Iran conflict, disrupting trade flows. The Panama Canal is reporting an unexpected jump in revenue, confounding its own forecasts that Donald Trump's trade wars would cause traffic to drop. Indian refiners are moving quickly to buy Russian oil after the US relaxed restrictions on the trade.
Alternative Assets & Private Markets
Bahrain-based alternative asset management giant Investcorp closed a fund that buys minority stakes in private investment firms, drawing commitments of over $1.1 billion. KKR & Co. is seeking a $500 million loan to back its acquisition of a majority stake in school operator XCL Education Holdings Pte. Credit investors are swiftly unwinding long positions worth tens of billions of dollars and jumping into hedging trades.