Market Summary
Global Markets closed higher as the President Trump laid out his administration's new strategy for "protecting America's interest" in Afghanistan; where US troops have been present since 2001, prompting a positive response from NATO, the UK and Afghanistan's president. The DAX finished 1.35% higher, led by gains in health care company Fresenius. The CAC 40 added 0.87% as the French information technology consulting corporation Capgemini rose 2.33%. The FTSE 100 closed 0.86% up.
Tough Times for Provident Financial
The British subprime lender saw its shares and bonds tumble after forecasting a full-year loss and revealing it is being investigated by regulators. Adding to this, its Chief Executive Officer Peter Crook stepped down. The drop in the share price wiped more than 3 billion from its market value.
The company also showed a further deterioration at its home credit business after dismantling the more-than-a-century old business model for new technology. In fact, many of its self-employed door-to-door salesmen and debt collectors quit their jobs when they were informed that they were being replaced by iPad- toting full-time staff.
Schlumberger totally buys Panuco
Schlumberger Ltd NV assumed complete control over the firm running the Panuco Integrated Service Contract. Panuco is situated in the state of Veracruz on the shores of the Gulf of Mexico. The company considers Mexico’s energy reform as being a significant step in the evolution of the country’s oil and gas industry, with new business opportunities emerging created under the new reforms.
Geopolitical Tensions leaving their mark
Turkey has signed a contract to purchase the advanced S-400 anti-aircraft missile systems from Russia. Good to note that the contract has not entered into force as yet as some technical issues remain to be fixed. The sophisticated anti-missile system is designed to shoot down aircraft at a range of up to 400km and ballistic missiles up to 60km away, while engaging 36 targets at the same time. Turkey turned to Russia and took out a loan to finance the deal, since it lacks the adequate technology to develop its national defense system by itself. This procurement of air defense systems from Russia may become a matter of concern for the U.S. as they had previously dismissed reports of such purchase.
Berkshire Hathaway Credit Rating UP
Warren Buffet’s Berkshire Hathaway’ credit outlook was lifted from “negative” to “stable” from Standard and Poor’s, following the collapse of the acquisition of A Texas Utility Oncor. The previous downgrade came in light after the company had announced an agreement to buy a restructured Energy Future Holdings (EFH) for $9 billion along with EFG’s 80% interest in Oncor. The negative outlook on the company reflected the uncertainty around the financing of the acquisition. The company’s shares were trading in the green.
Disclaimer
This article was issued by Rodrick Duca, Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.