DAILY MARKET REPORTS
- U.S. stocks opened lower Wednesday, reversing a recent rebound as investors parsed escalating geopolitical tensions and the latest gauge of U.S. inflation.
- President Donald Trump said early Wednesday that U.S. missiles “will be coming” to Syria, and warned he was willing to challenge Russia directly in launching a military strike against Syrian President Bashar al-Assad over an alleged chemical-weapons attack.
- Russia had earlier warned that any U.S. missiles fired at Syria over a suspected chemical weapons attack on a rebel enclave would be shot down.
- The Labor Department said its Consumer Price Index slipped 0.1 percent, the first and largest drop since May 2017. But the core CPI, which excludes the volatile food and energy components, rose 2.1 percent year-on-year in March, the largest advance since February 2017.
- Chief Executive Mark Zuckerberg started his second day of testimony before the U.S. Congress.
US FINANCIAL MARKET
Brent hits highest since 2014 after Trump warns missiles ‘will be coming’
- Oil hit its highest in more than three years on Wednesday after U.S. President Donald Trump threatened to fire missiles at Syria in response to a suspected chemical attack last week.
- Brent crude jumped to a high of nearly $72 a barrel, its strongest since early December 2014, after Trump’s comments.
- Syria is not a significant oil producer, but any sign of conflict in the region tends to trigger concern about potential disruption to crude flows across the wider Middle East, home to some of the world’s biggest producers.
Sprint-T-Mobile merger talks back on, control key
- Sprint has restarted talks to merge with T-Mobile, people familiar with the matter said on Tuesday, the latest effort to bring together the fourth and third largest U.S. wireless carriers.
- The combined company would have more than 127 million customers and could create more formidable competition for Verizon and AT&T, amid a race to expand offerings in 5G, the next generation of wireless technology.
- Sprint and T-Mobile decided to restart talks partly because they want to share the burden of investing in their networks, the sources said. The negotiations are at an early stage, they added.
- Sprint’s majority owner, SoftBank, has been looking to trim its debt, which reached 15.8 trillion yen ($147 billion) as of the end of December. It has said it is planning to raise cash by taking its Japanese mobile phone unit public this year.
Shari Redstone likely to replace Moonves as head of CBS if no deal with Viacom
- Shari Redstone is likely to replace CBC chief Les Moonves if no merger deal is reached with Viacom, sources tell CNBC.
- CBS is expected to make another offer soon, but the new bid is expected to fall short on price, sources say.
BofA to stop lending to some makers of military firearms
- Bank of America plans to stop lending to companies that make military-style firearms for civilians, Bloomberg reported, making it the second major U.S. lender to address gun sales after the Florida high school shooting that left 17 dead in February.
- Last month, Citigroup added restrictions on firearm sales for new retail sector clients, requiring them to sell firearms only to customers who passed a background check, restricting sales for buyers under 21, and not sell so-called bump stocks or high-capacity magazines.
Aluminum Set for Biggest Winning Streak in 30 Years on Sanctions
- Aluminum is heading for its biggest winning streak since 1988 in the four days since the U.S. slapped sanctions on United Co. Rusal and as top exchanges said they’ll stop accepting metal from the Russian smelting giant.
- The metal advanced 3 percent on Wednesday to $2,266.50 on the London Metal Exchange. That’s up 13 percent since Thursday, before the U.S. announced sanctions.
- Both the LME and CME Group’s Comex have said they won’t allow new deliveries of metal from Russian billionaire Oleg Deripaska’s Rusal, the biggest aluminum producer outside of China.
U.S. companies found ways to avoid taxes before tax bill: report
- Fifteen U.S. corporations including online retailer Amazon.com, power company Duke Energy and insurer Prudential Financial avoided U.S. tax on nearly $25 billion in combined profits last year, a tax watchdog group said on Tuesday.
- A report by the Institute on Taxation and Economic Policy, said data showed how profitable Fortune 500 companies have routinely lowered their tax bills long before the Republican tax overhaul signed into law by President Donald Trump in December.
- he nonpartisan group said the new U.S. tax regime, which slashed the corporate income tax rate from 35 percent to 21 percent beginning in January, will likely allow corporations avoid even more tax.
US ECONOMY & POLITIC
Trump Warns Russia U.S. Missiles ‘Will Be Coming’ to Syria
- President Donald Trump said that U.S. missiles “will be coming” to Syria, and warned he was willing to challenge Russia directly in launching a military strike against Syrian President Bashar al-Assad over an alleged chemical-weapons attack.
- He warned Russia it shouldn’t be “partners” with Mr. Assad, whom he termed a “Gas Killing Animal who kills his people and enjoys it!”
- The U.S. and France have positioned warships armed with cruise missiles within firing range of Syria, and the U.S. has been working to rally international support for a strike.
- Mr. Trump has vowed to punish Russia and Iran if the U.S. concludes they helped with the weekend strike that killed more than 40 people, including women and children. But there was no indication that the U.S. would target Russian and Iranian forces in Syria.
Underlying Inflation Shows Signs of Pickup in U.S.
- The consumer-price index, reflecting what Americans paid for everything from housing to dental care, fell 0.1% from a month earlier, the first decline since May 2017.
- The drop owed entirely to a temporary decline in gasoline prices.
- Excluding energy and food, consumer prices rose 0.2%, extending a trend of steady growth. Costs of housing, medical care and food all rose.
- Over the past year, consumer prices rose 2.4%, and core prices climbed 2.1%. Those were the strongest annual gains in a year.
U.S. mortgage applications fall to 7-week low
- The volume of U.S. mortgage applications fell to a seven-week low even as most home borrowing costs declined last week, the Mortgage Bankers Association said on Wednesday.
- The Washington-based industry group said its seasonally adjusted index on mortgage applications fell 1.9 percent to 380.6 in the week ended April 6.
- This was the lowest level since 372.9 in week of Feb. 16.
House Speaker Paul Ryan Won’t Seek Re-Election
- The timing of his announcement came as a surprise. Lawmakers had expected Mr. Ryan might leave Congress if Republicans were to lose control of the House in November’s midterm elections.
- Mr. Ryan on Wednesday told colleagues he will remain speaker until January.
- Mr. Ryan had reluctantly become House speaker in 2015 after his predecessor, John Boehner of Ohio, was pressured to quit, and his future plans had been seen as uncertain.
- Last year, as the tax overhaul bill neared passage, many House GOP lawmakers and aides said they believed Mr. Ryan would leave in 2019 if the GOP lost its control of the House majority in the 2018 midterm elections.
Trump Signs Executive Order for Revamp of Federal Aid Programs
- President Donald Trump signed a broad executive order urging a revamp of federal government aid programs Tuesday, invigorating a contentious debate from which Republicans hope to gain momentum before the November elections.
- The order is primarily aimed at programs such as food stamps, which covers about 43 million Americans, Medicaid, which covers 74 million people, and housing programs, an official said.
- It doesn’t include Supplemental Security Income, a means-tested welfare program providing cash assistance to some poor disabled people.
- It also doesn’t include a separate order the Trump administration has considered that would deny immigration benefits for people who had used a wide range of social programs.
- Mr. Trump’s move to revive the issue comes as House Republicans seek to secure changes to the food-stamps program through the farm bill.
EUROPE & WORLD
European Commission raids offices in sports broadcasting investigation
- The European Commission on Tuesday raided the offices of a number of companies involved in sports broadcasting rights, including a unit of Rupert Murdoch’s Fox, as part of an investigation into a possible cartel.
- The Commission said it had carried out unannounced inspections in several member states at companies that distribute “media rights and related rights pertaining to various sports events and/or their broadcasting”.
- Fox Networks Group (FNG), an operating unit of Murdoch’s 21st Century Fox which distributes TV and cable channels around the world, said it was cooperating with the EC inspection after officials raided its offices in London.
- The Commission did not name any of the companies affected, but Murdoch’s FNG confirmed its involvement after it was first reported by the Telegraph newspaper.
Airbus sees backloaded deliveries in 2018, reaffirms target
- Airbus Chief Executive Tom Enders said on Wednesday the planemaker expects deliveries of narrowbody jets once again to be backloaded towards the latter part of the year – possibly even more so than before – due to ongoing engine issues.
- Deliveries have been delayed by delivery and quality problems on engines provided by Pratt & Whitney, and most recently engines from French-U.S. venture CFM. Pratt-powered A320neo deliveries have been suspended.
- Both engine suppliers for Airbus narrowbody jets remain “stressed,” but Airbus – whose main rival is Boeing – is sticking by a target of delivering some 800 aircraft this year, Enders said.
Bayer to sell digital farming business to win approval for Monsanto deal
- Bayer said it was planning to sell its digital farming business, and not just grant a license to competitors, to win antitrust approval for the planned takeover of Monsanto.
- In addition, certain Bayer seed treatment products will be offered for sale instead of Monsanto’s NemaStrike seed treatment brand.
China Takes New Step Toward Opening Its Financial Markets to the World
- China has pledged to launch a stock trading link between Shanghai and London by the end of this year, taking a fresh step towards opening up its financial markets and providing the U.K. with a vote of confidence ahead of Brexit.
- The plan, announced by China’s central bank governor Yi Gang at a forum on Wednesday, is part of a suite of new measures aimed at further widening foreign investors’ access to China’s financial sector.
- The so-called Shanghai-London Stock Connect program will come after Beijing moved in recent years to allow global investors to trade on its two domestic stock markets, Shenzhen and Shanghai, via similar trading links with Hong Kong.
- The trading link allows qualified mainland investors to buy and sell shares in the Hong Kong market, a factor that has helped boost trading volumes there.
More than 250 killed in Algerian military plane crash
- More than 250 people were killed when a military plane crashed in a field outside Algeria’s capital on Wednesday, state media said, in the country’s worst air disaster.
- A total of 257 people were killed, most of them military. Ten crew and other people described as family members also died, and a number of survivors were being treated at an army hospital
- The plane was heading to Tindouf, an area on Algeria’s border with Western Sahara, but crashed on the airport’s perimeter, Algeria’s defence ministry said.
Panama to suspend Venezuelan airlines in retaliation
- Panama will ban several Venezuelan airlines from working in the country for at least 90 days, the government said on Tuesday, the latest twist in a dispute that began when Venezuelan officials were put on a “high risk” money laundering list.
- Last week, Venezuela halted commercial relations with Panamanian officials and companies, including airline Copa, for alleged involvement in money laundering, prompting both countries to recall their ambassadors.
- Panama’s government said in a statement on Tuesday that several airlines including Aeropostal Alas de Venezuela and Santa Barbara Airlines would be suspended for 90 days from April 25.
TODAY in HISTORY
- Napoleon was exiled to the island of Elba. (1814)
- Iowa imposed the first state cigarette tax. (1921)
- President Lyndon B. Johnson signed the 1968 Civil Rights Act. (1968)
- President Ronald Reagan returned to the White House after he was shot in an assassination attempt. (1981)
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