U.S. STOCKS ADVANCE IN EARLY TRADE
- In Europe, Deutsche Bank’s shares hit lowest level in decades.
- Worries about the German lender, whose shares are down around 54% so far this year, rippled across the European banking sector.
- Qualcomm shares rose 3.5% after sources said the company was in talks to buy NXP Semiconductors in a deal valued at more than $30 billion.
- Costco was the top percentage gainer on the S&P, rising 4.5% after the company reported a better-than-expected quarterly profit.
US FINANCIAL MARKET
- Costco reported higher quarterly profit Thursday boosted by lower credit card fees.
- Costco’s profit rose 1.6% to $779 million despite higher wages, lower gasoline sales and deflationary pressure on food items including meat and eggs.
- Some 11.4 million co-branded American Express cards, representing about 7.4 million accounts, had been transferred to new Visa Citi cards, and about 85% of those accounts have now been activated with Costco.
- Another 1.1 million members have applied for the new card since June 20.
- Net sales, which exclude membership fees, rose 2% to $35.7 billion.
- Deal would likely be valued at more than $30 billion.
- The companies could strike an agreement in the next two to three months.
- NXP reported $6.1 billion in revenue and $1.5 billion in profit last year.
- Company says Microsoft’s $26.2 billion acquisition of social network would be anticompetitive.
- Both companies’ interest in LinkedIn centers on data generated by its members, who typically maintain career résumés on the site.
- LinkedIn claims 450 million members in more than 200 countries, including 106 million monthly active uses.
- Promontory’s expertise combined with Watson, IBM’s artificial intelligence computer system, would help banks meet ever-rising regulatory expectations.
- Privately held Promontory was founded in 2001 by Eugene Ludwig, a former U.S. Comptroller of the Currency, and has hired a small army of former senior regulators and government officials.
- Banks and government agencies use the firm as an adviser, but also as a sort of outsourced regulator, which sometimes performs jobs the government doesn’t have the resources to do.
- Qatar Airways is in the process of firming up the order, which it was due to have placed at July’s Farnborough airshow, but which was delayed by the Qatari government in an effort to speed up U.S. approval for the fighter contract.
- Bloomberg reported that the deal was for at least 30 Boeing 777 and 787 jets, valued at about $6.7 billion at list prices.
- The United States had begun notifying lawmakers informally that it had approved the sales of 36 Boeing F-15 fighter jets to Qatar, valued at around $4 billion.
US ECONOMY & POLITICS
- Personal consumption, which measures how much Americans spent on everything from new cars to nursery schools, was unchanged in August from a month earlier.
- Incomes rose 0.2%, the slowest growth since February.
- The personal saving rate rose to 5.7% last month from 5.6% in July, though it remains below levels seen at the start of 2016.
- The personal-consumption expenditures price index, the Federal Reserve’s preferred inflation measure, rose only 0.1% from the prior month.
- From a year earlier, the index was up 1.0%.
- The University of Michigan index rose to 91.2 in September from the month’s preliminary reading of 89.8.
EUROPE & WORLD
- Some hedge funds have withdrawn securities or cash, or dialed back their trading activities.
- Bloomberg News reported earlier Thursday that some Deutsche Bank clients have moved derivatives holdings to other firms this week, citing an internal bank document.
- Deutsche Bank has more than €220 billion (about $246.8 billion) of liquidity reserves.
- New bond-buying policy suggests recent shift from easing at all costs.
- The BOJ on Sept. 21 drastically redesigned its program to fight deflation, saying that its main target would be the interest rate on 10-year government bonds, not the quantity of bonds purchased.
- The BOJ set a zero target for the 10-year bond yield.
- Swedish fashion retailer’s profitability hurt by August heatwave which forced it to sell stock at a discount.
- H&M said net profit fell to 4.82 billion Swedish kronor ($562 million) in the quarter.
- Revenue rose about 6% to 56.8 billion kronor from 53.4 billion kronor.
- Uber’s Japan arm is running pilot ride-hailing programs to expand beyond food delivery.
- Uber brought UberEats to parts of Tokyo on Thursday, betting that the food-delivery service could be a big money spinner for the company.
- French aerospace and defense supplier Safran said Thursday it has begun exclusive talks to sell its identity and security business in a transaction that values the operation at €2.4 billion ($2.7 billion).
- Aerospace and defense supplier expects the deal to close in 2017.
- The move comes as Safran focuses increasingly on its aerospace and defense activities, where it is a major supplier of everything from engines for Boeing and Airbus planes to rockets.
TODAY in HISTORY
Mozart’s opera The Magic Flute premiered in Vienna, Austria (1791)
Twenty-two Nazi leaders were found guilty at the Nuremberg trials (1946)
Actor James Dean was killed in a car crash (1955)
Botswana gained its independence from Great Britain (1966)
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