World Themes This Week 🌍 Tech Firms Under Fire In New Zealand 🔥

Table of Contents

 

1. World Themes This week

We’re in for a relatively quiet start to the week with US and Canadian markets closed to celebrate Washington’s birthday and Family Day respectively. The remainder of the week, however, is set to be a hum-dinger. 

With US-China trade talks ending on a positive note last week, investors are beginning to price in a resolution in the not too distant future with the Dollar softening on Friday and Asia opening in the green this morning as riskier assets absorbed upbeat investors’ capital. Concrete evidence of progress would buoy global investor confidence and offset some of the concerns about the global slowdown.

In the Eurozone area, more uncertainty regarding Brexit and slowing growth in the region may force a shift in guidance from the European Central Bank (ECB). More signs of financial stress on the EU in the next few weeks could give the ECB no option other than a softer monetary policy outlook to follow many other countries in the recent rate-dropping trend. Lower rates would give equities some room to breathe in the short-term, but without any resolution to its internal and external growth issues, the ECB is just delaying the slowdown’s inevitable return.

On the commodity front, both Brent Crude and WTI have broken through the topside of their sideways ranges thanks to the effects of OPEC supply cuts and sanctions on Iran and Venezuela effectively curbing supply. This week could prove to be a big one for oil bulls as they try to push prices to the $70 per barrel mark.

Are you ready for a big week?

 

2. Tech Firms Under Fire In New Zealand

And they’re feeling the burn. The Kiwis have signalled their intentions to update their taxation legislation for e-commerce and technology platforms, putting the likes of Facebook, Amazon and Google squarely in its crosshairs.

New Zealand is the latest of many nations on the tax bandwagon trying to capture their fair share of revenue from the tech giants that have, until now, pillaged undisturbed. The current value of cross-border digital services is approximately a whopping $1.86bn or NZ$2.7bn.

The proposed digital services tax (DST) flat rate of 2-3% on the gross revenue of multi-national companies has the potential to raise roughly NZ$30-80 million in annual revenues in New Zealand alone. Many other countries are also hopping on board with DST’s of their own, including the UK, Spain, Italy, France and Australia. Well, it’s about time!

The days of evading taxes seem to be numbered for the tech behemoths, and the momentum of the taxation trend could significantly crimp these companies’ margins going forward. With the official release of the taxation plan scheduled for May 2019 (pending discussion), the clock is ticking for the tech sector to come up with some innovative escape routes. Let’s see if they’ve got any more fast moves left to pull.

 

2. Company Results Coming Up This Week

Monday – Anglo American, Ambuja Cements, Reckitt Benckiser, Transocean Ltd

Tuesday – HSBC, Walmart, First Energy, APA Group, Danone, Spectris, Advance Auto Parts, Genuine Parts, Medtronic, Devon Energy.

Wednesday – Garmin, Sonic Healthcare, United Technologies, Fresnius Medical Care, Glencore, Lloyds, Iberdrola, CVS Health, Southern Company, GoDaddy Inc.

Thursday – Barclays, Domino’s Pizza, Deutsche Telekom, Baidu, Gazprom, Quantas Airways, Woolworths, Telefonica, BAE Systems, Newmont Mining, Novatek, First Solar, Hewlett Packard, Kraft Heinz

Friday – Re/Max, AutoNation, Galapagos, United Overseas Bank, Pearson, Cabot Oil & Gas, Pinnacle West Capital

Today we are watching…

1.  Transocean Ltd (#transo)

Ultra-deep ocean oil-rig producer, Transocean, is looking decidedly shaky ahead of its earnings call today with analysts unsure as to whether the company can beat expectations this quarter. The precipitous drop in oil prices from October-December caused a massive shift from offshore drilling to land-based drilling, impacting the company’s margins significantly. Operational inefficiencies and 37.5% higher expenses are also likely to filter through into a weaker performance for the early part of 2019.

2. Mattel (#mattel)

Mattel’s surge in value following its solid earnings report on the 7th was all but wiped out on Friday as short-sellers erased 17.63% from its share price after the company issued its 2019 guidance. The toy-maker announced that it expected gross sales to remain flat for the year, weighed down by weaker demand from some of its leading products and a stronger Dollar. Even though Mattel’s sales have declined for the past five years running, analysts were expecting the company to beat estimations with an average projection of 3.5% growth. This shortcoming caused the massive sell-off which may continue this week.

 

 

 

 

 

 

 

Share:
More Posts
PGA Tour Enters Investment Talks 💪

As reported on Thursday, both Endeavor Group and Fenway Sports have displayed interest and begun discussions to provide investment in the PGA Tour.

Nike Just Didn’t Do It 📉

Providing one of the biggest earnings reports of the week, $140 billion shoe and clothing retailer Nike posted a significant slip.

Market Recap – September 28th 💰

After the 10-year Treasury yield bond fell off from its 15-year high, investors added some value back into the market, focusing all short-term attention on Friday’s PCE price index reading.

The Crude Oil Bust 🛢

Surging global crude oil prices, driven by factors like OPEC+ production cuts have pushed U.S. West Texas Intermediate futures to over $95 per barrel.

Get your daily Invstr Crunch

Get the market news and updates you need, delivered to your inbox or available on our daily podcast.

Risk Disclosure:

Invstr is not a bank and banking services are provided by Vast Bank, N.A.

Brokerage and Banking services are currently only available to U.S. residents.

Invstr app and web services are provided by Invstr Ltd. Advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC) details of which can be obtained here. Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value.

Investing involves risk and can lead to losses. Past performance does not guarantee future results.

Invstr app and web services are provided by Invstr Ltd. Invstr+ advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC). Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value. Vast Bank N.A. a nationally chartered bank and member of the FDIC, provides the banking products, including the products and services related to digital asset accounts. As with any asset, the value of Digital assets can go up or down and there can be a substantial risk that you lose money buying or holding digital assets. You should carefully consider whether trading or holding Digital assets is suitable for you in light of your financial condition. Your digital account does not support wallet to wallet transferring of your digital assets (i.e. cryptocurrencies) outside the platform. Any Digital Assets in your digital asset account are not insured by any government entities, including but not limited to FDIC or SIPC. The Invstr Visa® Debit Card is issued by Vast Bank, N.A. pursuant to a license from Visa U.S.A Inc and may be used everywhere Visa debit cards are accepted. Invstr Ltd, Invstr Financial LLC and Invstr Securities Ltd are subsidiaries of Marketspringpad Holdings (collectively “Invstr”) and Invstr is solely responsible for the application services and website content.

Watchlists provided when users first access the service are not a recommendation to invest. Instead they are provided to help users better navigate the service. Users are free to edit and create their own watchlists. From time to time, Invstr will suggest instruments solely based on an individual’s interest and the interest levels of the Invstr community. The statistical and portfolio builder models generated by Invstr do not reflect actual investment results and are not guarantees of future results. Comments provided by Invstr leaders, influencers or members of the Invstr Community are not recommendations and should not be construed as such. Invstr does not endorse the content or the positions posted by them. Their investment approach, and that of the models provided by Invstr, may be different from yours and may not be appropriate for you.