The Week in Numbers: EU Rejects Brexit Extension


The British pound fell sharply on Wednesday, 20th March, after Theresa May’s request to delay Brexit by 3 months until June 30 was rejected by the European Union.

The pound dropped to a low of US$1.3147 and lost 1% to the Euro to 86.39 pence. Britain’s divorce with the EU remains uncertain, with potential options including leaving with May’s deal (that was voted down by parliament), requesting a longer delay or a disruptive exit. Even another referendum remains on the cards.

British government bonds also fell after the news, with the 30-year gilt yield hitting its lowest in 16 months.

Walt Disney Co acquired Fox’s entertainment assets for US$71.3 billion. Disney said that the deal should help it grow internationally. Among the assets acquired from 21st Century Fox was Dutch-based media firm Endemol Shine famous for its reality show Big Brother. Bob Iger, CEO of Disney said that acquisition will create “significant long term value” and allow it to expand its content offering. With the deal, Disney now owns movie franchises such as X-Men, Deadpool, Fantastic Four, as well as animation comedy, The Simpson.

However, the deal will reportedly result in a loss of at least 4,000 jobs as Disney hopes to improve operating efficiency. The House of Mouse estimates that improved operating efficiencies will result in over US$2 billion in savings by 2021.

In a surprise move, the Federal Reserve is not expected to increase the benchmark lending rate again this year. In its second meeting of the year, the committee said the growth of economic activity has slowed from its solid rate in the fourth quarter.

The committee members now forecast a median federal funds rate this year of 2.4%, down from December’s forecast of 2.9%.

Facebook could be finally moving into the lucrative e-commerce space. Facebook-owned Instagram added an option to buy products shown off posts in more than 20 selected brands in the US. The new “checkout” button was launched in a beta version of the app. Besides selling fees, Instagram ad revenue could also get a boost Checkout could convince brands that the social network provides higher returns on investment and sales conversions due to the fewer steps it takes to purchase its products.

Lendlease Group could be planning to list its retail assets in a real estate investment trust in Singapore, according to a report. The report, which cited Thomson Reuters IFR Asia said that the Australian property developer could raise up to US$500 million from the listing. Lendlease current retail projects in Singapore include Parkway Parade, 313@Somerset and Jem Mall.

In a further twist of the tale, Hyflux Ltd (OTCMKTS: HYFXF) has cautioned that the S$500 million restructuring agreement with SM Investments Pte Ltd may be terminated if defaults by Hyflux subsidiary Tuaspring Pte Ltd are not remedied within two weeks. Public Utilities Board has said that the national water agency would exercise its right to terminate its water purchase agreement with Tuaspring and take control of the plant if all defaults are not resolved. 90% of revenue at Hyflux Tuaspring integrated water and power plant are derived from selling electricity to the national power grid.

Last but not least, it seems that Lion Air is preparing for a domestic initial public offering. Indonesia’s largest private carrier is seeking to raise around US$1 billion, people close to the matter said. A US$1 billion share sale would be Indonesia’s third largest IPO on record according to Bloomberg.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Jeremy Chia owns shares in Facebook Inc. The Motley Fool Singapore has a recommendation on Facebook Inc and Walt Disney Co.



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