US stocks closed mixed on Thursday as investors were keenly awaiting the testimony of Federal Reserve Chair Jerome Powell to the US Senate on the state of the economy.
Powell noted that the Fed was not comfortable with the current levels of inflation even as the economy begins to bounce back.
The Dow Jones closed up 0.15% while the Nasdaq 100 fell 0.71% at the close. The S&P 500 closed 0.33% lower.
Intel to buy GlobalFoundries for $30B
According to the Wall Street Journal, American technology company Intel Corp. is in talks to acquire semiconductor company GlobalFoundries Inc. in a deal worth about $30 billion.
The reports noted that negotiations have not been concluded and GlobalFoundries could instead opt to go public. GlobalFoundries is owned by Mubadala Investment Co., an investment arm of the Abu Dhabi government based in the U.S.
Moderna Joins S&P 500
Moderna Inc.’s shares surged in premarket trading on Friday after the S&P Dow Jones Indices announced on Thursday the pharmaceutical company will join the S&P 500 stock market index on July 21.
The Massachusetts-based firm will replace Alexion Pharmaceuticals Inc., which is to be taken over by AstraZeneca plc on the same date.
US jobless claims Hit Lowest Since March 2020
Initial jobless claims in the United States for the week ending July 10 fell by 26,000 compared to last week’s to land at 360,000, the lowest since March 14, 2020.
According to the US Department of Labor reported, the four-week moving average was also at a March 14, 2020 low of 382,500, down by 14,500 compared to the prior week’s revised average.
Morgan Stanley Q2
Morgan Stanley on Thursday reported its second-quarter financial results with net revenue landing at $14.8 billion mainly driven by higher stock valuations and strong IPO activity during the period.
Its Institutional Securities unit brought in $7.1 billion in revenues while its net income amounted to $3.5 billion.
“With our transformed business model providing more stable and durable earnings, we have doubled our dividend and announced a $12 billion buyback as we move to return our excess capital to shareholders. Our global franchise is very well positioned to drive further growth,” Morgan Stanley’s CEO James P. Gorman noted.
Binance Regulatory Challenges
Hong Kong’s Securities and Futures Commission has become the latest among a number of financial regulators, including Italy and Thailand, that have come out against the exchange in recent weeks.
The Italian Companies and Exchange Commission on Thursday said that cryptocurrency exchange Binance is not authorized to provide its services in the country, following a similar warning from the UK’s financial regulator issued on June 25th 2021.
A number of banks including Britain’s largest lenders Barclays and Santander UK have blocked their customers from transferring money to Binance.
On the other hand, Visa and Mastercard said they are monitoring the situation regarding Binance but will not block customers from using their cards on the Binance exchange.
Meanwhile, Commenting on the crypto market, Fed Chair Jerome Powell noted that cryptocurrencies have “completely failed” to become a permanent payment mechanism adding that the only people that use it for payments are those that want to retain anonymity.
OPEC ON global Economy and Oil Forecast
The Organization of the Petroleum Exporting Countries (OPEC) on Thursday said that it expects the global economy to grow 5.5% in 2021 and 4.1% in 2022. The 2021 figure is unchanged from the previous estimate.
In its Monthly Oil Market Report for July 2021, OPEC warned about the impact of the coronavirus variants, the pace of global vaccination efforts, sovereign debt levels, pressures on inflation and monetary policy responses as main factors that could impact the economic projections.
OPEC also expects global oil demand to average 96.6 million barrels per day this year, unchanged compared to its last forecast, according to its monthly market report.
OPEC also predicted that demand will rise by 3.3 million b/d in 2022, while US oil demand is seen “only marginally below” 2019 pre-pandemic levels.
Revolut hits $33B valuation
British fintech firm Revolut has raised $800 million in funding for a $33 billion valuation, marking a six-fold increase compared to a year ago.
The funding round was led by SoftBank Group Corp. and Tiger Global Management LLC. Investors include TCV, Balderton Capital, and others. Revolut plans to use the money for marketing, product development, and international expansion.
Earlier in June, the company reported its revenues grew 57% per annum in 2020, landing at approximately $230 million. Gross profit was up 215% year-over-year to $170 million, while operating losses fell 90% to $8 million.