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Wall Street Breakfast

Author: bmotrader   |   Latest post: Fri, 13 Dec 2019, 9:17 AM

 

Wall Street Breakfast: Alibaba Sets New Singles' Day Record

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The event regularly racks up bigger sales than Black Friday and Cyber Monday combined, but Alibaba (NYSE:BABA) already topped last year's record in 16.5 hours with gross merchandise value of 213.5B yuan ($30.5B). That's equal to 87% of Amazon's (NASDAQ:AMZN) online store sales in its latest quarter, and the figure is set to rise further. Held back by a slowing overall e-commerce industry and the trade war, sales growth for the full 24-hour event is still likely to fall short of last year's 27%, according to analysts. Alibaba first latched on to Singles' Day - symbolized by the four lonely 1s of 11/11 - in 2009, and has transformed the holiday into the world's biggest online sales event. BABA -0.7% premarket.

Hong Kong chaos rattles stocks

Traders are closely following the events in Hong Kong, where the Hang Seng Index lost almost 3% after the city's start-of-week commute descended into turmoil. A day after three pro-democracy lawmakers were arrested, police fired gunshots at protesters as they tried to block roads and delay trains, sending one man to the hospital in critical condition. Dow futures also fell 115 points on the news in the U.S., where the bond market is closed Monday due to Veterans Day.
Go deeper: The Global Investor saw 30% downside in MSCI's Hong Kong ETF back in August.

Another cash windfall for Alibaba

Alibaba (BABA) has added Citigroup (NYSE:C), JPMorgan (NYSE:JPM) and Morgan Stanley (NYSE:MS) to the sales force for its secondary market listing on the Hong Kong Stock Exchange, and invited several Chinese banks to do the same. The deal is being led by Credit Suisse (NYSE:CS) and China International Capital Corporation, according to Bloomberg. Alibaba plans to start taking investor orders on Nov. 15 and price the "up to $15B" offering on Nov. 20.
 

Saudi Aramco releases IPO prospectus

Up to 0.5% of shares will be allocated to individual investors in what could be the biggest initial public offering in history (the process will begin on November 17 and close on December 4). Other crucial information was lacking, like the total percentage of the company to be sold, the level at which the shares will be priced, and an estimate of the total value of Aramco (ARMCO). Give or take a trillion... Analyst valuations of the state-backed oil giant have so far varied greatly, ranging from between $1.2T to $2.3T.
 

'Sexist' Apple Card algorithm

New York's Department of Financial Services has initiated a probe into the credit card practices of Goldman Sachs (NYSE:GS) following a series of tweets from David Heinemeier Hansson, the creator of Ruby on Rails. He slammed the Apple Card (NASDAQ:AAPL) for giving him 20x the credit limit than his wife - despite filing joint tax returns and his wife having a better credit score - and alleged that gender discrimination was present in algorithms that determined credit limits. Launched in August, the Apple Card is a joint venture between Apple and Goldman, which is responsible for all credit decisions related to the card.
 

Keystone pipeline reopens

Crude resumed flowing on Sunday after 9,120 barrels of oil leaked out in North Dakota in late October, marking Keystone's largest-ever spill. Pipeline operator TC Energy (NYSE:TRP) said the line will now operate it at a reduced pressure, gradually increasing the volume of crude moving through the system. Users of the pipeline are also concerned that Keystone's transportation exemption - for higher than standard pressure levels - may be at risk after four significant leaks over the past decade.

Cannabis-based medicines milestone

Two cannabis-based medicines - manufactured by GW Pharmaceuticals (NASDAQ:GWPH) - have been recommended for use by the NHS for the first time. Epidyolex has been approved for two rare types of epilepsy, Lennox-Gastaut and Dravet syndromes, while the spray Sativex has been recommended for muscle spasms in multiple sclerosis. Campaigners welcomed the decision, but said thousands of other people with a range of conditions who could benefit from cannabis-based medicines were left in limbo.
 

Britain avoids a recession

The U.K. economy welcomed a return to growth in the third quarter as GDP expanded 0.3% following a 0.2% contraction in Q2. Things are still looking weak. On an annual basis, U.K. GDP only rose by 1%, marking the lowest rate since the first quarter of 2010, when Britain clawed its way out of the financial crisis. "Manufacturing, the largest sub-sector of production, was also flat in the three months to September 2019," according to the Office for National Statistics. Sterling +0.4% to $1.2824.

Today's Markets

In Asia, Japan -0.3%. Hong Kong -2.6%. China -1.8%. India +0.1%.
In Europe, at midday, London -1.3%. Paris -0.2%. Frankfurt -0.6%.
Futures at 6:20, Dow -0.4%. S&P -0.5%. Nasdaq -0.5%. Crude -1.5% to $56.36. Gold +0.2% to $1466.40. Bitcoin -1.7% to $8685.
Ten-year Treasury Yield +2 bps to 1.95%

Today's Economic Calendar
No event scheduled
Veterans day
Bond market closed

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