Five Things You Need to Know to Start Your Day
Good morning. The hand of peace is being stretched out across the U.K.’s House of Commons, trade talks get started again and cryptocurrencies are back on the tips of tongues. Here’s what’s moving markets.
In order to break the Brexit impasse, U.K. Prime Minister Theresa May is looking to turn Labour leader Jeremy Corbyn into a frenemy, reaching across the aisle for cross-party talks to help work out a joint plan that would stand a chance of getting approved by Parliament. Plus, she'll ask the European Union for a further delay. It comes after a day of warnings, including Angela Merkel calling on Ireland to make all the necessary preparations for a no-deal outcome that the Dutch prime minister thinks is now more likely. Analysts, however, think a general election has become more likely.
Trade War Blues
European stocks don’t seem to care about all the bad news flow and could be the best way to play an “everything rally” that takes bonds along for the ride. But the doomsaying is still coming thick and fast. Christine Lagarde, managing director of the International Monetary Fund, said global growth momentum has stalled and that the picture looks “precarious.” The World Trade Organization was no more sunny, cutting its global trade projection for 2019 to the lowest for three years and blaming the tit-for-tat tariff war for the move. U.S.-China talks kick off again Wednesday, so watch for more on the trade front as the week progresses.
An auspicious start followed by an equally noteworthy fall. Lyft Inc. is now trading well below its IPO price after two days of declines and with analysts questioning its growth path and saying it will take a “leap of faith” to justify its valuation. But fear not, IPO watchers! One of the other unicorns the market is awaiting: Workplace messaging firm Slack Technologies Inc. is still planning to go ahead with its listing in the summer to keep the momentum up. And it’s not just the new guys. Chemicals company Dow Inc., spun out from DowDuPont Inc. and with more than a century of history behind it, surged on its first day of independence.
Plenty of assets are having a great start to 2019 and cryptocurrencies must have been feeling left out. Bitcoin and its cohort surged despite traders and market watchers struggling to find any reason. One of the rumors? It was sparked by an April Fool’s joke claiming regulators had approved two exchange-traded funds tracking Bitcoin. Others suggested it was short unwinding. Whatever it was, keep an eye for further volatility or even, just even, a sustained rally.
Asian stocks are comfortably in the green and European futures are pointing to a moderately positive open ahead of the trade talks and after China services industry data beat expectations. Oil has also continued to gain, with Brent now knocking on the door of $70 a barrel for the first time since November. Euro area and U.K. services PMI data are ahead, along with a host of speakers from the Federal Reserve and crude inventory data from the U.S.
What We’ve Been Reading
This is what’s caught our eye over the past 24 hours.
- Climate change is increasingly impacting central bank policy.
- The new Avengers film is crashing ticket sites.
- Taipei, where the ultra-wealthy hide their Hermes.
- Searching for the holy grail of zapping nuclear waste in minutes.
- Decrypted podcast on why drugs are still on sale on Instagram.
- The battle for beer supremacy in Nigeria.
- Plagiarism and clickfarms: the bad side of self-publishing.
©2019 Bloomberg L.P.