1) Many on Wall Street are betting the Federal Reserve Bank will again reduce the cost of borrowing in light of the coronavirus economic threat. Futures contract traders consider there is nearly a 60% chance of a rate cut this March, when the Feds meet, in an effort to counter the effects of the virus on America’s economy. While it appears the spread of the pathogen is declining in China, elsewhere in the world it’s on the rise.
2) Oil prices continue its downward spiral with a twelve month low for U.S. crude. The drop in oil prices is in anticipation of slowing of the U.S. and world economies, a direct result of the spreading coronavirus threat. China, a major world importer of oil, has cut back purchases as it containment policies reduces oil consumption from limited travel to and from major cities, as well as travel within those cities.
3) The home food delivery business continues to grow with DoorDash filing the paperwork with the SEC (Security and Exchange Commission) to start the IPO (Initial Public Offering) process to offer stock to the public. The IPO process has met with poor results from unprofitable companies like Lyft Inc. and Uber Technologies Inc. while WeWork was forced to abandon its IPO last year because of a poor showing of its stock. DoorDash faces the same challenges as Lyft and Uber..
4) Stock market closings for – 27 FEB 20: This is the worst point decline ever for the three markets. The Dow has dropped 3,000 points since Monday.
Dow 25,766.64 down 1190.95
Nasdaq 8,566.48 down 414.30
S&P 500 2,978.76 down 137.63
1) The Oklahoma energy company Chesapeake Energy, who helped pioneer America’s shale natural gas revolution, is now warning that it may not survive the era of cheap gas it helped usher in. In a filing to the Securities and Exchange Commission, the company stated that if depressed prices persist, there is substantial doubt if it can survive. Fracking made it a natural gas powerhouse, at one time the number two natural gas producer, but now it is drowning in $10 billion dollar debt.
2) The U.S. productive has fallen for the first time since 2015. American productivity fell 0.3% in the third quarter, after two quarters of healthy gains, while productivity had increased 1.4% in the past year, about two-thirds of its long run average. Additionally, the low unemployment rate is driving up labor costs by forcing companies to pay more for workers, a trend that could eventually raise inflation. Labor cost rose at 3.6% in the third quarter, up 3.1% for the past year.
3) SoftBank Group Corp. reported an enormous loss from investments in the two money losing startups WeWork and Uber Technologies Inc. SoftBank reported a loss of $6.5 billion dollars after writedowns in WeWork and other investments, the first such loss in 14 years. The massive losses were incurred when WeWork’s IPO failed leaving the startup company cash starved so SoftBank had to extend a $9.5 billion dollar rescue package and take an 80% stake in the company.
4) Stock market closings for – 6 NOV 19:
Dow 27,492.56 up 0.07 Nasdaq 8,410.63 down 24.05 S&P 500 3,076.78 up 2.16
If you viewers have been watching the reports of former Turing CEO Martin Shkreli, and his reported “ponzi scheme” that he has been maneuvering along securities fraud. His investors has spoken up indicating their discontent and suing him for squandering their money entirely.
On his twitter account Mr. Shkreli issued a statement indicating that the allegations brought against him by the SEC and federal prosecutors are baseless at best, and actually have no merit whatever.
Mr. Shkreli is the pharama CEO of Turing that produces drugs for HIV and Aids. He has become a villain within the past few months for raising AIDS medication Daraprim from $13.50-$750, more then 5,500% from its previous cost.
Politicians and other pharma companies, advacates and analysts have criticized Shkreli’s move in raising the price of Daraprim and he has been cast as a shrewd businessman by the international community and media.
The head of Nigeria’s Securities and Exchange Commission Aruma Oteh has vacated her post after one full term. Ms. Oteh first came into the post during former President Umaru Yar’adua’s tenure in January 2010.
Ms. Oteh’s was widely seen and hailed as a reformer, wanting to make Nigeria’s financial markets first class in Africa and the rest of the world. Her initiatives led to newer and up to date regulated (NSE) Nigerian Stock Exchange rules, that allowed fair accountability and competitiveness been businesses and financial trading.