1. Stocks Slip Near Record Highs; Crude Oil Declines

Global stocks slid near record highs in subdued trading at the end of the week. Oil futures fell for a second day, while the dollar strengthened. European stocks slumped, with retail and energy stocks posting losses. In the U.S., Treasuries edged up and S&P 500 futures dipped after the benchmark closed at an all-time high on Thursday. Most markets in Asia were closed for the Lunar New Year holiday. Despite losses on Friday, global stock markets are still on track for a weekly advance, with the MSCI World up 1.1% in the past five days.

Futures on the S&P 500 Index sank 0.4% as of 8:39 a.m. London time.

The Stoxx Europe 600 Index declined 0.2%.

The MSCI Asia Pacific Index decreased 0.1%.

The MSCI Emerging Market Index dipped 0.1%.

2. Oil’s Red-Hot Rally Fizzles With Virus Continuing Hold on Market

Oil slipped below $58 a barrel as a recent rally fizzled with the Covid-19 pandemic continuing to weigh on the demand outlook and as one technical indicator signalled prices may have climbed too far, too fast. Futures in New York fell for a second session on Friday after surging more than 12% for the longest run of gains in two years. The enduring outbreak continues to crimp fuel consumption from China to the U.S., with the International Energy Agency cutting its demand forecast for 2021 and describing the market as fragile. The U.S. government earlier this week also predicted the nation’s petroleum demand will likely need much more time to recover.

3. Australia Enforces Lockdown; U.S. Orders Doses: Virus Update

Australia’s second-most populous state will enter a five-day lockdown after a spike in cases, with movements in Victoria to be restricted from late Friday night. The Australian Open tennis tournament underway in the capital of Melbourne will continue but without spectators. The Philippines will soon allow cinemas to resume operations and expand seating capacity at religious gatherings. President Joe Biden announced that the U.S. has finished deals for 100 million additional vaccine doses each from Pfizer and Moderna and that the companies would deliver new and existing orders quicker than projected. U.S. vaccine supply should increase enough by April to allow anyone who wants a shot to begin getting one, said Anthony Fauci, the nation’s top infectious disease doctor.

4. Norway GDP Even Stronger Than Expected; Rate Hike Rumored

Norway’s economy grew much faster than expected at the end of last year, underpinning bets its central bank will be the first in the rich world to raise interest rates this year. Mainland gross domestic product, which adjusts for Norway’s offshore industry, grew 1.9% in the fourth quarter. For all of 2020, Norway’s mainland economy contracted 2.5%, much less than the 3.5% decline the central bank had predicted. Norway, the richest Nordic economy thanks to its oil wealth, emerged much stronger from 2020 than the eurozone, where the economy shrank almost 7%. Norway’s resilience, underpinned by its $1.3 trillion wealth fund, has economists betting the central bank will be able to raise rates years before others.

5. French Carmaker Rivalry Defies Macron’s EV Battery Vision

President Emmanuel Macron’s vision for France to join forces in building batteries for cars of the future isn’t going exactly as planned. The more than 120-year rivalry between Peugeot and Renault SA has proved too fierce to overcome, even for a 5 billion-euro ($6 billion) project backed by their powerful shareholder, the French government. Instead, PSA Group, now part of Stellantis, and oil giant Total are pushing ahead without Renault, which may pursue its own plans with South Korea’s LG Chem Ltd. France and Germany, where the electric revolution is making obsolete thousands of jobs in areas like engine and transmission-making, have led the political push over the past few years for developing a local battery cell industry in a bid to take back control of a car part that can make up 40% of an EV’s value. 

6. Musk’s Younger Brother Sells $25.6 Million of Tesla Shares

Kimbal Musk, the younger brother of Elon Musk and a Tesla board member, sold $25.6 million of shares in the electric-car maker. The 48-year-old sold 30,000 shares on Feb. 9 at an average price of $852.12. Tesla shares dropped 5.3% Wednesday to close at $804.82. Tesla soared 743% in 2020 and is up another 14% this year. The transaction reduced Kimbal Musk’s holding to 599,740 Tesla shares, which amounts to $483 million. Tesla insiders hold a 19.6% stake in the company.

7. U.K. Economy Caps Worst Year Since 1709 With a Surprising Surge

Figures published Friday add some weight to the Bank of England’s view that while the economy will likely shrink in the first three months of the year, a successful vaccine rollout and a surge in household savings during lockdowns could power a sharp recovery in 2021. The gross domestic product grew 1% in from October through December, fueled by a boom in construction and government spending. Output contracted 9.9% for the whole of 2020, slightly below the latest estimates of the U.K.’s fiscal watchdog. The outlook hinges on the degree of scarring left by the pandemic and how soon can the government capitalize on one of the world’s fastest vaccination campaigns to loosen restrictions.

8. Klein’s Churchill Said to Raise $1.68 Billion in Two New SPACs

Financier Michael Klein raised a combined $1.68 billion in initial public offerings of two new blank-check companies. Churchill Capital Corp. VI raised $480 million, upsized from $400 million in the IPO. A second special purpose acquisition company, Churchill Capital Corp. VII, raised $1.2 billion after earlier planning to raise $1 billion. One of Klein’s SPACs is in talks to take Lucid Motors Inc. public in a transaction that would value the carmaker at about $15 billion. That SPAC, Churchill Capital Corp IV, closed trading Thursday at $31.50 a share, more than three times its $10 trust price. JPMorgan Chase & Co. is leading the Churchill VI IPO, while Churchill VII is being advised by Citigroup Inc.

9. Merkel Warns Mutations Could Wreck Progress in Virus Fight

Chancellor Angela Merkel warned that aggressive coronavirus mutations will gain the upper hand in Germany sooner or later, threatening to destroy the progress made in containing the pandemic. Europe’s largest economy needs to maintain tight controls even as contagion rates steadily decline and immunizations slowly ramp up, Merkel said Thursday. The fast-spreading British variant is already in the country, and strains from Brazil and South Africa are also a risk, she added. Under pressure from state leaders, the chancellor agreed late Wednesday to loosen some virus restrictions and open a pathway to a return to some semblance of normality after months of stringent curbs.

10. Coronavirus Weakens Netanyahu’s Allies Ahead of Polls

About half of Israel’s ultra-Orthodox Jewish community thinks their own leaders have failed them during the coronavirus pandemic — and that could hurt Prime Minister Benjamin Netanyahu’s already troubled re-election bid. Talk of boycotting the March 23 election is percolating In Israel’s fractured political landscape, a party’s loss of a parliamentary seat or two can determine the outcome of the entire vote. Ultra-Orthodox, or haredi, parties have been staunch allies of Netanyahu and currently control 16 of parliament’s 120 seats. Any weakening of their clout would make it even tougher for the prime minister to form a governing coalition.

Curated from Bloomberg.com