US airstrikes dominate markets this morning
With the US and allied forces ramping up military action on Islamic State terrorists bringing new caution to investors Asia has seen some weak trading today. Most major indexes ended lower although China saw more positive territory following yesterday’s better data on manufacturing output. Europe is expected to follow Asia’s lead with a dampened start to the trading day. US stock futures are trending higher. Gold is holding onto gains while oil is lower as geopolitical unrest is overshadowed by over-supply.
New homes sales data at 10am ET.
Accenture and Pacific Commerce are among the companies reporting earnings today.
Calls for Fed to raise rates sooner
The president of the Kansas City Federal Reserve has called for interest rates to rise sooner than planned. Esther George says that the move is needed because too many investors are taking excessive risks in the financial markets and to avoid inflation hikes. George says that the rises should be gradual so as not to stifle growth in the economy. She believes that a steady increase in rates will allow markets to price themselves in a more sustainable and normal rate range. George does not have a vote on the Fed’s policy setting committee this year. Read the full story.
Buffett loses $750 million on supermarket investment
Warren Buffett’s Berkshire Hathaway has seen $750 million wiped off its investment in UK supermarket chain Tesco. Poor sales at the world’s second-largest retailer behind Wal-Mart have been worsened by the news this week that its latest accounts overstated profit forecasts by £250 million. Buffett’s company is the third-largest shareholder in Tesco with a stake it paid $1.7 billion for but Tesco shares have fallen by up to 43 per cent this year. Read the full story.
Starbucks to take full control of Japanese operation
Starbucks says it plans to take control of the joint venture it launched in 1996 in Japan, its first overseas market. The firm will the 39.5 per cent stake owned by its regional partner Sazaby’s and then seek to buy up the 21 per cent owned by other investors. The purchase will cost the firm $900 million. With 1,000 stores employing 25,000 people in Japan the company is aiming to further grow its business there, which has held up well against the financial issues in the country. It may even consider a launch of its Teavana tea outlets in the region. Read the full story
Walgreen considers sale of infusion services business
Drugstore operator Walgreen is said to be considering selling off a majority stake in its infusion service business for a reported $1.5 billion. The service has attracted private equity interest and has annual revenues of $105 billion. Read the full story.