Photographer: Krisztian Bocsi/Bloomberg
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Amazon takes another shot at traditional retailers, tech rebound continues, and it’s major Merger Monday in Asia. Here are some of the things people in markets are talking about.
American brick-and-mortar retailers suffered at the hands of a familiar foe Monday. Reports indicated that Amazon has been setting up a service to rival Best Buy's "Geek Squad" and assist customers in setting up smart home devices. Shares of Best Buy fell more than 6 percent, its biggest loss in more than a year. The SPDR S&P Retail ETF fell more than 2 percent on the day. Separately, Abercrombie & Fitch Co.'s announcement that it failed to reach a buyout deal sent the stock -- as well as some of its peers -- tumbling. Meanwhile, ProShare Advisors LLC is trying to make it easier for investors to wager on the death of American malls by launching ETFs that bet against companies most likely to be affected by the rise of e-commerce.
Tech shares kept Friday's momentum going, pacing gains for major U.S. equity gauges Monday. The S&P 500 Index inched 0.1 percent higher while the Nasdaq 100 rose 0.7 percent. The enduring low-volatility environment, however, is wreaking havoc on trend-following strategies. Ten-year Treasuries and the greenback were little changed; crude oil rose modestly amid reports that Libya and Nigeria may be asked to cap production in a bid to reduce the supply glut more expediently.
That's the value of Asian deals announced in a 24 hour-span to kick off the week, the biggest Merger Monday action in almost a year for the region. The M&A was headlined by Sunac China Holding Ltd.'s $9.3 billion purchase of hotels, land, and projects from Dalian Wanda Group Co., the largest property deal in China on record. The busy day comes as some relief for investment bankers in the region, who had been faced with a more difficult environment as the Chinese government sought to dampen overseas acquisitions.
Australian housing and confidence data will be in focus Tuesday. The June update of the NAB's business confidence and conditions indexes are slated to be released at 10:30 a.m. Tokyo time, along with May's reading of home loans. Approvals are expected to rebound by 1.5 percent on a monthly basis on the heels of a 1.9 percent retreat in April. The Reserve Bank of Australia has made use of its lesser-known, broad third mandate to promote the economic prosperity and welfare of the people to justify keeping its policy rate at a record low amid a highly indebted household sector.
It may have been Merger Monday, but it was also a manic Monday for many Asian stock exchanges, which saw halts and data issues suppress volumes in major bourses. But that didn't stop the MSCI Asia Pacific Index from advancing, taking its cues from last week's strong finish in U.S. equities following a Goldilocks June payrolls report. S&P/ASX 200 futures are virtually flat ahead of the open, while Nikkei 225 futures are trading modestly to the downside.
What we’ve been reading
This is what caught our eye over the last 24 hours.
China to plug the big hole in its internet firewall.
EM sovereign bonds yield more than corporates.
Butter is the remedy for Goldman's trading desk woes.
Chinese hedge funds bounce back.
Oil glut needs bigger fix than Libyan and Nigerian caps.
Who's going to wake up in this new Bugatti?