Daily Market Update

Daily Market Update

Daily Market Update Markets shift focus and start the week mixed
Last week was action-packed for the markets with policy decisions from the Fed and European Central Bank, the threat of the UK breaking up and the excitement of the Alibaba IPO. This week there are new focuses and in Asian markets it’s largely about China. The world’s second-largest economy may be contracting and PMI data on manufacturing due tomorrow will give an important indicator; for today Asia’s major markets have been cautious as a result with most closing down. In Europe, Friday’s rally following Scotland’s decision to stay in the UK was short-lived and today the focus is on the continued weakness in the Eurozone and that Chinese data too. All of the major European indexes are trending downwards. The US markets ended last week flat; the Alibaba shares are not on the major indexes so the successful launch had no real effect. The dollar is down slightly against the Yen after recent gains and stock futures are in the red.

Today’s data
Figures on US sales of existing homes is released at 10am ET.

GM in major recall over parking brake concerns
With the ignition switch disaster still ongoing and sales declines in some of its markets, the last thing General Motors needs is another technical issue. This morning though the company is recalling hundreds of thousands of its Cadillac and Chevrolet models over concerns that a parking brake defect could cause a fire. Over 220,000 vehicles are being recalled, mainly in the US and Canada. Although no crashes or fatalities have been reported due to this issue, GM is taking no chances having recalled 15 million vehicles worldwide following the ignition switch issues. Read the full story.
 
Alibaba is the largest ever IPO
With additional shares having pushed the value of its IPO to $25 billion, the launch of Alibaba on to the public stage is confirmed as the largest ever. Its debut on Friday saw $21.8 billion raised and a 38 per cent surge in the share price by the closing bell. An option to issue further shares was then taken, adding almost $4 billion to the day’s trades and beating the previous biggest IPO by $3 billion. Read the full story.
 
Siemens to buy Dresser-Rand for $7.6 billion
US Oil and gas equipment manufacturer Dresser-Rand is set to be acquired by European industrial giant Siemens for $83 per share. Siemens has announced the deal this morning; it values Dresser-Rand at $7.6 billion and it’s a cash deal for shareholders. While analysts say that Siemens are paying a premium it does make sense for them as they look to capitalise on the growth of shale oil and gas mining; something they have not exploited enough according to their CEO. The deal is unlikely to complete before next summer and competing deals could emerge in the interim. Read the full story.
 
Wall Street to be ‘flooded’ today
Climate change protestors will be ‘flooding’ Wall Street today in a bid to highlight the role of big business in environmental risk. With world leaders due in New York tomorrow for a UN summit on climate change, the #FloodWallStreet campaigners will be focusing their attention on profiteering made in the fossil fuels sector. Protestors will hold sit-ins around the financial sector and also inflate a 15 foot ‘carbon bubble’. Read the full story.