Current Affairs – 02 September 2020 - Doo Prime News
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Current Affairs – 02 September 2020

WORLDWIDE : HEADLINES

PayPal entry punishes Australia’s pricey buy-now-pay-later stocks

SINGAPORE – Shares in Australia’s Afterpay Ltd (APT.AX) and its smaller consumer lender rivals tumbled for a second day on Wednesday, as the entry of U.S. giant PayPal into the buy-now-pay-later sector sent investors scrambling to re-price its frothy stocks.

Afterpay fell as much as 12.4%, before paring losses, and has shed about A$2.4 billion ($1.8 billion) in market capitalisation in the two trading sessions since PayPal Holdings Inc (PYPL.O) said it would offer small, short-term loans to U.S. customers.

“Having such a large customer base already in the U.S., PayPal certainly throws a spanner in the works for their expansion plans,” said James Tao, a market analyst at CommSec in Sydney.

Rivals also tumbled, with Zip Co Ltd (Z1P.AX) dropping as far as 17.7% and Sezzle Inc (SZL.AX) 15.5% before both trimmed losses. They have each lost more than 23% in two days. Openpay Group Ltd (OPY.AX) and Splitit Ltd (SPT.AX) each fell about 9%.

Full coverage: REUTERS

Citi receives China fund custody licence

HONG KONG – A Citigroup (C.N) China unit has received a domestic fund custody licence from the China Securities Regulatory Commission, the bank said on Wednesday, the latest foreign financial firm to expand its presence in mainland China.

Citi is the first U.S. bank to receive such a licence, which will allow it to hold securities for safekeeping on behalf of mutual funds and private funds domiciled in China, once it has passed an onsite inspection.

Despite Sino-U.S. political tensions, several U.S. asset managers are expanding their presence in China, after foreign ownership restrictions were scrapped earlier this year.

Full coverage: REUTERS

WORLDWIDE : FINANCE / ECONOMY / STOCK MARKET

Dollar edges higher on solid U.S. economic data

TOKYO – The dollar bounced off two-year lows on Wednesday as U.S. data pointed to a firm manufacturing activity, while the euro retreated from its highest levels since 2018 on profit-taking.

Economic data published on Tuesday showed U.S. manufacturing activity accelerated to a nearly two-year high in August amid a surge in new orders, with the reading from the Institute for Supply Management highest level since November 2018.

The U.S. data followed similarly upbeat Chinese and European manufacturing indicators.

Mitsuo Imaizumi, chief FX strategist at Daiwa Securities, said an increase in pent-up demand, such as for cars, has contributed to the rise in the greenback.

The dollar index =USD inched up 0.12% at 92.346, having hit its lowest since April 2018.

Full coverage: REUTERS

Oil rises after U.S. inventories draw, optimism of economic recovery

TOKYO – Crude oil futures rose on Wednesday after a more-than-expected draw in U.S. crude stockpiles and as solid U.S. factory data raised optimism of a post-pandemic economic recovery, boosting risk appetite among investors.

Brent crude LCOc1 futures were up 33 cents at $45.91 a barrel as of 0034 GMT, extending gains into a third day.

U.S. West Texas Intermediate futures CLc1 rose 33 cents to $43.09, following the previous day’s gain by 15 cents.

U.S. crude inventories fell by 6.4 million barrels in the week to Aug. 28 to about 501.2 million barrels, the American Petroleum Institute (API) said, compared with analysts’ expectations for a draw of 1.9 million barrels.

Gasoline stocks also fell by 5.8 million barrels, more than analysts’ estimates of a draw of 3.0 million barrels.

Analysts had forecast a sixth weekly drawdown in U.S. crude inventories in a Reuters poll. <EIA/S>

Full coverage: REUTERS

Asian shares set to rise as recovery comes into focus

NEW YORK – Asian shares were set gain on Wednesday, encouraged by buoyant U.S. moves that followed stronger-than-expected manufacturing indicators while the dollar emerged from its recent lows against the euro.

Investors in Asia await Australia’s gross domestic product data, which is expected to confirm the economy fell into its deepest slump since the Great Depression.

However, Tom Piotrowski, a market analyst at Australian broker CommSec, said market participants are now likely to look past the dire historic numbers as more recent data suggests the global recovery is gaining momentum.

He noted the risk on Australian GDP is that comes in higher than expected, which would help sentiment. Australian equities, which have underperformed because of the strong local currency, also could be helped by the dollar’s latest rise.

Australian S&P/ASX 200 futures were up 0.39% in early trading.

Full coverage: REUTERS

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