There is a shortage of chicken after poultry supplier Inghams suspended a number of products as it fights staff shortages and supply chain disruptions caused by covid. The largest supplier of chicken to McDonalds, KFC said in an investor update Tuesday that the virus has had a “significant impact” on production, distribution and sales. Share price tumbled 5.7%.
In the meantime, grocery shoppers have seen buying limits on chicken and other products as supermarkets fight the return of hoarding. KFC’s Beyond Meat Nuggets aren’t sounding too bad right now?
Djokovic wins appeal, but minister rules to deport
Novak Djokovic’s participation in the Australian Open is in question after Australia’s federal immigration minister, Alex Hawke, canceled his visa for a second time late on Friday. The world number one is set to appeal the ruling but it remains to be seen whether he will face compatriot Miomir Kecmanović on Monday. The tennis star has not been in detention since a Federal Court ordered his release on Monday.
The saga has highlighted Australia’s border policies and its treatment of refugees.
U.S. inflation reaches new high not seen since Reagan
US prices soared to the highest level since 1982, rounding out a year in which inflation has returned to the political agenda for the first time in two generations. The Consumer Price Index, measuring a basket of household goods and services, was up 7% in December year-over-year, with energy prices up 29% on year, and used cars up 37% on year. Markets responded with equanimity as the data came in as expected.
US technology: Tumultuous week
The US technology sector continued its slide for a second week, with dip buyers and sellers sparring in a series of wild sessions. The Nasdaq composite was down 0.8% for the week at Thursday’s close, after Tuesday’s rally succumbed to renewed selling.
The index which is heavily weighted in tech shares has slid 6.5% in 2019 as investors reassess their technology bets amid rising prospects of a rate hike from US Federal Reserve in coming months.
Bank of Spain approves Block-Afterpay agreement
Block (formerly Square) will add Afterpay to its roster next week once the Bank of Spain granted its seal of approval to the takeover, clearing the last obstacle to the $39 billion deal. Approval was also required for Afterpay due to a bank in Europe that it holds a license with.
Australia’s biggest BNPL player will appear for a final time on the local bourse on 19 January before returning to the market under the symbol SQ2 the next day. Afterpay's exodus comes as the sector attempts to turn around months of share price weakness that has left peer Zip underpriced now for the first time since the pandemic in the view of analysts.
BLACK IN BLACK: Blackstone suitors the Crown
Blackstone, a global investment group, dazzled Crown’s board with an $8.9 billion cash offer for the troubled casino operator that is non-binding. The offer of $13.10 per share represents a premium to a $12.50 offer made in November. The group is conducting due diligence in the next few days, when a formal offer could be made.
The Crown board plans to unanimously recommend the bid, if Blackstone submits a formal offer on equivalent or better terms. The news sent the shares up 8%, and they are now screening as ‘fairly valued’ valuation metrics. Angus Hewitt, an equity analyst, estimates that there’s a 50% chance the bid will go through.
Guangzhou, not Geelong: The true threat from Omicron
By the measures China is using to control the spread of the virus, and the degree to which the curtailments are widespread, “we’re setting ourselves up for a round of negative supply shocks globally if this continues,” Preston Caldwell, chief economist for the financial research firm, wrote in an email.
The world’s most populous country is still wedded to stamping out outbreaks, with the strict lockdowns and quarantines that are falling out of fashion in most countries. Bottlenecks and shortages could intensify as key Chinese ports and factories are closed or slow, according to a new report.
Iron ore bounces back
Prices for Australia’s biggest export earner are sizzling after traders wagered on a recovery in steel demand in China. Iron ore spot prices are within touching distance of the US$130 level on Wednesday, a 20%-plus increase since December. The metal is still far from the US$200-plus mark left mid-last year.
Worse-than-usual seasonal supply disruptions in Brazil and expectations for a rebound in Chinese demand are behind the unexpected advances, says the broker Jefferies. Big miners BHP and Rio are up about 10% year to date since prices are rising.
ASX weighed down by tech stocks in volatile week: Market wrap
The ASX 200 closed 0.8% lower on the week, concluding a topsy-turvy set of sessions that were dominated by interest rate jitters. Shares fell 1.1% Friday with technology stocks battered by the weight of government-bond yields.
Afterpay fell 9.2% to mark its weakest close since early August 2020. Other losers were fund manager Pendal, down 12% after detailing that outflows had picked up in the December quarter. Online furniture retailer Temple and Webster dropped about 10% on Friday as well.
Heavyweight miners BHP and Rio Tinto gained nearly 5% each for the week as iron ore prices surged, lifting sentiment. The major banks were mixed. Westpac and Commonwealth Bank fell between 1.6% and 2%. NAB added 0.4%. ANZ finished flat.
Here are three reads for a lazy Saturday
So the Federal Reserve is back in the news, and we got a refresher on how it works from Eric Compton.
“The history of the end of poverty has only just begun”, writes this data-packed account of the global story of progress against poverty from Our World in Data . There’s a way to go: 94% of China’s population still subsists on less than $30 a day, despite decades of blistering growth.
Oil and Bitcoin markets have been shaken by continuing civil unrest in the commodity-exporter nation of Kazakhstan, where citizens have protested rising energy prices and an out-of-touch government. The Economist breaks down what’s happening, with the help of a horse, a Swiss mansion and a Birkin bag.
