Market Outlook – August 10, 2018

Nasdaq Logs Best Win Streak Since October

 

Worries over the escalating trade dispute between Washington and Beijing continues to hound Wall Street. The solid corporate earnings somehow temper the negative sentiment. On Thursday, the Nasdaq Composite Index picks up its stride to rise for an eighth straight session. It’s the index’s best winning streak since October. The tech-heavy index climbed 3.46 points (+0.04%).

Throughout the trading session, the S&P 500 Index was in positive territory before retreating later and losing 4.12 points (-0.14%). The Dow Jones Industrial Average shed 74.52 points (-0.29%) due to the weakness in energy and industrial sales.

According to JPMorgan Chase & Co. (JPM), U.S. earnings are solid overall as gleaned from the quarterly results. This also is the highest number of companies that beat earnings estimates since the third quarter of 2009.

IEA Warns of Disruption in the Oil Market

 

The International Energy Agency (IEA) issued a warning on Friday that the oil market could soon become “less calm.” The rising geopolitical tensions between the United States and Russia on the one hand and between Canada and Saudi Arabia on the other have been causing jitters to Investors.

As a result, oil prices dropped as much as 0.9% to trade at $66.30 per barrel. The statement from the energy-monitoring agency based in Paris read, “As oil sanctions against Iran take effect, perhaps in combination with production problems elsewhere, maintaining global supply might be very challenging.”

WB to Use Blockchain Technology to Raise Funds  

 

The world’s first global blockchain bond is about to be issued if the World Bank proceeds with its plan. With the international lender using the emerging technology, it’s a significant mainstream endorsement.

The World Bank already hired Commonwealth Bank of Australia to manage the bond. The bond will have the name “Blockchain Offered New Debt Instrument,” or “bond-i,” which is with reference to the Bondi Beach in Sydney. And they hope to raise about $73 million.

German automaker Daimler was the first to issue a type of German bond using the blockchain technology. The technology is best known in bitcoin and other cryptocurrencies. It serves as a digital record of financial transactions.

Qualcomm Resolves Anti-Trust Case with Taiwan Regulators

 

Instead of paying a nearly $778 million fine imposed by Taiwan’s Fair Trade Commission in 2017, Qualcomm Inc. (QCOM) will settle its anti-trust case with the Taiwanese regulators in a different manner. The mobile chipmaker will settle for $93 million plus a $700 million investment pledge in the country over the next five years.

The U.S. firm was accused of refusing to sell chips to mobile handset makers that wouldn’t agree to its patent-licensing terms. It was also alleged that they cut Apple Inc.’s (AAPL) a royalty discount in exchange for the exclusive use of Qualcomm’s modem chips in the past.

Under the settlement, Qualcomm is required to provide reports every six months to Taiwanese officials for five years as a sign of good faith with handset makers in patent-licensing deals. Further, QCOM will have to offer patent licenses to rival chipmakers such as Intel Corp. (INTC) and MediaTek Inc.

Qualcomm is also facing a $927 million fine from the Korea Fair Trade Commission as well as a $1.2 billion fine from the European Commission. There is also a lawsuit from the U.S. Federal Trade Commission.

Tesla Board Wants to See Details of Musk’s Financial Plan

 

Elon Musk, CEO of Tesla Inc. (TSLA) surprised investors on Tuesday with a ‘tweet’ about his plan to go private. He also mentioned securing a financing deal worth $72 billion.

Tesla’s board members held several discussions about the deal but have yet to receive a detailed financing plan from Musk. According to Reuters news sources, the board will seek more information as to how its CEO will take the U.S. electric car maker private in the proposed deal.

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