Markets drop on Chinese weakness and Russian sanctions
The week has started with losses on most of the world’s major markets as investors weigh up some tricky conditions. China’s factory output data for August shows its weakest level for six years, causing concern in Asia and also affecting the oil price as demand from the region declines. New Russian sanctions and further rhetoric from Moscow is a big concern for much of Europe, especially Germany with its strong trade ties to Moscow. Add into the mix uncertainty of the Scottish independence vote, the Fed’s policy meeting this week and the increasing likelihood of more military action in the Middle East and you have a cocktail of concern. The dollar continues to gain and safe-haven investments such as gold are rising. US futures are down this morning.
No major economic data due today but figures will be released on the number of injuries and deaths tied to the GM ignition switch issue; it could have an effect on the firm’s share price.
On Wednesday the Fed will hold its latest monetary policy meeting and on Thursday the Scottish independence vote will have an effect on UK listed companies with wider implications of course.
Facebook IPO was a concern for Alibaba
As the IPO for Chinese ecommerce giant Alibaba approaches pre-orders for the shares have been frantic. It could well be the biggest IPO ever. The firm is expected to launch its IPO by the end of this week and it looks like early investors will reap the rewards. The company weighed options for listings and settled in the NYSE who they say made the best pitch. Experts say that the firm had looked at Nasdaq which would have enabled it to be included on a major index faster, but may have been put off by the issues surrounding the Facebook IPO which led to trading delays two years ago. As a company domiciled in the Cayman Islands listing options are limited in any case. Nasdaq says it has fixed the issues of 2012 and wish Alibaba well with their IPO. Read the full story.
Heineken rejects takeover bid
The world’s third-largest brewer by volume has rejected a bid from a rival and vowed to stay independent. Heineken, based in Holland, is majority owned by the eponymous family and has rejected the approach from SABMiller, the world’s second-largest brewer. The combined firm would have been of similar size to the world’s number one, Anheuser-Busch InBev, which has been linked with a possible bid for SABMiller. It would have been difficult for Anheuser to have made an approach to the combined firm. Forecasters predict that there will be consolidation within the beer industry but it seems that Heineken won’t be swallowed up anytime soon.
Danaher gets its teeth into Swiss dental firm
The US conglomerate Danaher has announced that it has agreed to acquire Swiss-based Nobel Biocare Holding, valued at $2.2 billion. The deal will further grow Danaher’s global dental business but the Swiss firm will continue to trade under its own brand. The offer represents a premium of 23 per cent above the market price before speculation of a takeover began in July.