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Europe's Economy Can't Cope

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Good Morning,

Germany is forecasting its first two-year recession in two decades, BofA is losing work over its Asia block-trading probe, Jamie Dimon questioned pensions' private market investments, and China's stimulus rally took a major breather.

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Let's dive in.

Before The Bell

As of 10/09/2024 market close.

Markets

  • US stocks jumped as investors reacted to Fed minutes and shook off geopolitical concerns

    • S&P and Dow hit new ATHs

  • Canada's TSX index hit a new ATH

  • CSI 300's 7% drop was its biggest since 2020 and its first in eleven days

  • Europe's Stoxx 600 rose 0.6% from two-week lows

    • Markets fully priced in a third ECB rate cut to 3.25% next week 

  • US 10Y term premium turned positive for the first time since July

    • VIX of bonds surged to its highest level YTD

  • Dollar rose to two-month highs 

  • Traders are looking ahead to today's September CPI report

Earnings

  • What we're watching this week:  

    • Today: Delta, Domino's

    • Friday: JPMorgan, Wells Fargo, BlackRock

  • Full calendar here

🇺🇸 Election Forecast

As of 10/09/2024.

Headline Roundup

  • Fed minutes revealed divide over size of September rate cut (CNBC)

  • Leveraged bets on China stocks surge as risk appetite grows (BBG)

  • Regional banks bracing for tougher capital rules get relief from Fed cuts (RT)

  • Germany expects economy to shrink in 2024 (FT)

  • European industrial companies are most distressed since Covid (BBG)

  • Jamie Dimon questions pension funds' private investments (RT)

  • TD Bank faces $3B in fines and growth restrictions in US settlement (WSJ)

  • Bank of America is losing work over block-trading probe in Asia (WSJ)

  • UK firms given greater leeway to award execs big pay rises (FT)

  • OpenAI pursues public benefit structure to fend off hostile takeovers (FT)

  • Hurricane Milton could cost insurers up to $100B (RT)

  • GSK will settle Zantac cancer lawsuits for $2.2B (RT)

  • TreasuryDirect customer service requests could take a year (WSJ)

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Deal Flow

M&A / Investments

  • Canadian convenience store giant Couche-Tard increased its bid for 7-Eleven owner Seven & i Holdings by 22% to ~$47B

  • BlackRock and CVC are exploring an acquisition of private credit giant HPS Investment Partners, which was weighing an IPO at a $10B valuation  

  • Global miner Rio Tinto agreed to buy Arcadium Lithium for $6.7B cash

  • MCB Real Estate sweetened its offer for shopping center operator Whitestone REIT to ~$1.5B, including debt 

  • UK packaging firm Mondi will acquire German, Benelux, and UK packaging assets of Schumacher Packaging for $695M, including debt

  • Bernard Arnault and Red Bull will acquire 55% and 15% stakes in Ligue 2 team Paris FC respectively

  • Global commodities broker Oil Brokerage acquired rival Blue Commodities  

VC

  • Basecamp Research, an AI model to understand biology, raised a $60M Series B led by Singular

  • Cybersecurity startup HUMAN Security raised a $50M+ round led by WestCap

  • Carbon storage startup Paebbl raised a $25M Series A led by Capnamic

  • Case Status, an AI-powered client engagement platform for law firms, raised a $19.7M Series B led by Grayhawk Capital and Topmark Partners

  • Surfin, a fintech for the underserved middle class, raised $12.5M in funding from Insignia Ventures Partners

  • CYRISMA, an all-in-one risk management platform, raised a $7M Series A led by Blueprint Equity 

  • Molg, a robotics startup streamlining electronics production, raised a $5.5M seed round led by Closed Loop Partners 

IPO / Direct Listings / Issuances / Block Trades

  • Malaysia's MMC Port is considering a $1.6B IPO in what could be the country's largest listing in over a decade

  • Carlyle-backed analytical instruments maker Rigaku is looking to raise $870M in a Tokyo IPO

  • India's Adani Enterprises is seeking to raise $500M in a share sale s

  • CVC-backed Moove Lubricants, a subsidiary of Brazilian conglomerate Cosan, delayed its IPO  

Debt

  • Royal Bank of Canada sold $4.7B in bonds and may raise another $1.5B

Fundraising

  • Real assets investor Harrison Street closed its ninth US opportunistic real estate fund at $2.5B

  • PE firm Ember Infrastructure raised $500M for its second sustainability-focused fund

Crypto Corner

Exec’s Picks

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