“Trump’s meeting with Drug Makers…”

Oil

OPEC the organization of the Petroleum Exporting Countries, shall in the first half of 2017 cut production by around 1.2 million barrels per day (bpd) with the aim to stop global over-production that had effected markets for over two years. Other producers such as Russia, which is not a member of OPEC, pledged to cut output by another 600,000 bpd. The Brent crude futures LCOc1 the international benchmark for oil prices was trading at the $ 55.63 per barrel level while the US West Texas Intermediate (WTI) crude futures CLc1 rose to $ 52.86 a barrel.

US

Investors were hoping for a boost to the US economy however, Trump’s controversial policies such as the suspension on travel to the US from seven Muslim countries seems to have quite an opposite effect. The trump administration accused Germany, Japan and China of devaluing their currencies to gain an advantage on trade. According to Trump, “every country lives on devaluation” focusing on what China and Japan have done to play the money market. These comments about the currency of trading partners have added further uncertainty in the markets about the ‘US strong Dollar Policy”. This morning, after yesterday’s selloff, the Dollar is gaining against its G-10 peers. Angela Merkel rejected accusations from Peter Navarro who is the head of the White House National Trade Council, that her country is playing the foreign exchange market, while the Japanese Prime Minister Shinzo Abe and the country’s top foreign exchange official rejected Trump’s comments that Japan is devaluing the yen.

Trump’s meeting with Drug Makers

During a meeting at the White House with drug makers President Donald Trump said that drug prices were high and promised to get better bargains for government health programs and find ways to get new medicines to market faster. In this regard a key part of the health care reform is that of lowering drug prices. Earlier in the month, Trump’s comments and criticism about the industry sent drug and biotechnology stocks plunging. Trump also promised to reduce regulations, get new treatments to the market faster at the Food and Drug Administration, and increase competition internationally. The call for lower taxes and fewer regulations was embraced by the CEOs attending the meeting.

PMI

The Chinese official factory gauge stood at 51.3 in January which is ahead of expectations, with non-manufacturing PMI at 54.6. In the Euro area, manufacturing has also picked up as the HIS Markit Purchasing Mangers Index climbed to 55.2 from a 54.9 in December. In the UK the headline manufacturing activity was at 55.9 as factories saw input costs rise at a record pace after the drop in the sterling.

Reported Earnings

Apple Inc is back on track after five years as the top number one seller of smartphones, beating Samsung. Revenues were also boosted from its new iPhone 7 Plus. The profit at almost $18 billion have beaten Wall Street Expectations. Sales in the fiscal first quarter ended 31 Dec amounted to 78.29 million iPhones an increase of 4.69% which also beats Samsong’s electronics at 77.5 million in the quarter. Apple might have benefited from Samsung’s recall of the Galaxy Note 7. Iphone success is very important for Apple which accounts for more than two thirds of its total revenue.

Antonella Mercieca

Client Relationship Manager

Source:

Bloomberg

Date:

January 30th, 2017

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