1. U.S. Stock Futures Fluctuate While Dollar Climbs
U.S. equity futures fluctuated and the dollar strengthened as investors focused on comments from the Federal Reserve and European Central Bank about the outlook for monetary stimulus. In Europe, the ECB will keep an easy stance for as long as needed, and U.S. investors took comfort from remarks by two Federal Reserve officials that pushed back on the possibility of tapering bond purchases anytime soon.
Futures on the S&P 500 Index declined 0.1% as of early morning New York time.
The Stoxx Europe 600 Index was little changed.
The MSCI Asia Pacific Index rose 0.5%.
The MSCI Emerging Market Index climbed 0.5%.
2. House to Vote on Impeachment as Republicans Break From Trump
The U.S. House prepared to vote on a history-making second impeachment of Donald Trump as lawmakers seethed over his role inciting last week’s mob attack on the Capitol and the president’s once-firm control over the Republican party began to break down. Trump’s impeachment appeared inevitable in a vote Democrats anticipated would come Wednesday, with the resolution’s sponsors claiming broad support from Democrats and public backing from several Republicans. The House is set to begin debate shortly after 9 a.m., with the vote on the impeachment resolution expected by mid-to-late afternoon.
3. Lagarde Blasts Bitcoin’s Role in Facilitating Money Laundering
European Central Bank President Christine Lagarde took aim at Bitcoin’s role in facilitating criminal activity, saying the cryptocurrency has been enabling “funny business.” “For those who had assumed that it might turn into a currency — terribly sorry, but this is an asset and it’s a highly speculative asset which has conducted some funny business and some interesting and totally reprehensible money-laundering activity,” Lagarde said in an online event organized by Reuters. The remarks, made in a conversation largely focused on the euro area’s economic outlook, show top policymakers are taking notice as a speculative fever sweeps cryptocurrency markets.
4. Germany Curbs Entry; More Nations See U.K. Variant: Virus Update
Germany agreed on stricter rules for travellers arriving from high-risk nations to curb the spread of more transmissible Covid-19 strains. The Philippines and Hungary joined the list of countries that identified patients with the U.K. variant. Japan expanded its state of emergency beyond the Tokyo region, encompassing an area that accounts for more than half of its economy. The worsening outbreak is casting doubt on the fate of the postponed Olympics, which are set to be held in the nation’s capital in less than 200 days. U.S. President-elect Joe Biden will seek a deal with Republicans on another round of virus relief, rather than attempt to ram a package through without their support. U.S. deaths from the virus climbed by a record 4,610 on Tuesday.
5. U.K. Lockdown Shows Signs of Working in Early Days: UK PM
U.K. Prime Minister Boris Johnson said there are signs the national coronavirus lockdown is working, but warned it is “early days” and people must stick to the rules. He didn’t rule out toughening restrictions if necessary, but told the House of Commons that the existing rules could be starting to help bring down infections. England is in the second week of its third national lockdown, with schools shut to most pupils and people ordered to stay at home.
6. Circle K Owner in Talks to Buy Carrefour for About $20 Billion
Alimentation Couche-Tard Inc., the Canadian owner of Circle K convenience stores, is exploring a takeover of French grocer Carrefour SA in a roughly $20 billion deal that would create a trans-Atlantic retail giant. Couche-Tard’s initial proposal values the French company at about 20 euros per share, people with knowledge of the matter said. That would represent a roughly 29% premium to its Tuesday closing price. Carrefour is the biggest private employer in France.
7. U.S. Unveils Plan to Counter China’s Rise From India to Taiwan
The Trump administration declassified its strategy to ensure continued dominance over China, which focuses on accelerating India’s rise as a counterweight to Beijing and the ability to defend Taiwan against an attack. National Security Adviser Robert O’Brien on Tuesday announced the publication of the document, titled “United States Strategic Framework for the Indo-Pacific.” Approved by President Donald Trump in February 2018, it provided the “overarching strategic guidance” for U.S. actions the past three years and was released to show the U.S. commitment to “keeping the Indo-Pacific region free and open long into the future,” O’Brien said in a statement.
8. iPhone Assembler Foxconn Sets Up Automobile Arm as Apple Car Looms
Apple Inc.’s Taiwanese manufacturing partner Foxconn Technology Group is setting up a car venture, strengthening its automotive capabilities at a time when technology companies including its California ally are looking to expand in vehicles. Foxconn is joining forces with Chinese carmaker Zhejiang Geely Holding Group Co. to provide production and consulting services to global automotive enterprises. Amid reports of Apple considering making its own electric vehicles, Foxconn has been bulking up its automotive muscles swiftly. Such moves may help the company become a major contender to make cars for its largest customer.
9. Bitcoin Extends Weekly Drop as Doubts Swirl Over Crypto Boom
Bitcoin resumed declines Wednesday as the digital coin heads for its worst week since March last year, a drop that’s raised questions about the outlook for the cryptocurrency boom. Bitcoin fell as much as 6.8% to about $32,359 before paring some losses. The largest cryptocurrency whipsawed investors over the past few days, hitting a record near $42,000 on Jan. 8 and then tumbling to a low around $30,300. The price swings evoke memories of Bitcoin’s December 2017 bubble that was followed by a rapid collapse. They also test recent narratives, such as the argument that Bitcoin is maturing into a hedge against dollar weakness and inflation risk, and attracting longer-term investors.
10. Hedge Fund Trader Faces Extradition to Belgium in Cum-Ex Probe
A veteran trader with links to Cum-Ex “mastermind” Sanjay Shah faces extradition to Belgium as criminal probes related to the controversial tax strategy expand throughout Europe. Guenther Klar, who previously worked for Shah’s Solo Capital hedge fund, is being sought for questioning by Belgian prosecutors as part of an investigation into Cum-Ex trading. At least three countries, Belgium, Denmark and Germany, are seeking the extradition of London financial professionals related to Cum-Ex strategies. Prosecutors say investors illegally made billions of euros by rapidly trading shares to obtain multiple refunds on dividend taxes paid only once.