Federal Reserve Approves New Measure for Big Banks
The U.S. Federal Reserve has announced new rules that would apply to the country's 8 largest banks, which hold over $10 trillion in loans and securities. The group includes Goldman Sachs, Citigroup and JPMorgan Chase, which may face an estimated $12.5 billion financial shortfall under the new measures. The new measures, which were proposed in December, will focus on a bank's capital, which will increase for the 8 banks as a means to ensure they are more resistant to economic and market shifts. Currently, international banking rules dictate the banks must have a capital equivalent to 7% of its assets. Under the new provisions, JPMorgan - the largest U.S. bank by assets, will have to hold 4.5% more.
Gold Falls Alongside Chinese Gold Reserve Estimates
Gold futures fell for an eighth straight session as data showed China's gold reserves to be at half of market expectation. The drop pushes gold prices to its lowest level in over 5 years. August gold fell 2.2% ($25.10) to $1,106.80 an ounce. Meanwhile, China has released an update on its gold reserves for the first time in 6 years, reflecting a total of 53.32 million troy ounces - up 57% since the end of April 2009. However, the figures were still lower than expectations, given China is the world' largest producer of gold. Other metal prices have also declined, with September silver down 0.5% (7.6 cents) to $14.758 an ounce and Octobert platinum dropping1.3% ($12.70) to &988.60 per ounce.
First Data Corporation Slated to Go Public
First Data Corporation, a credit card and payments processor, filed on Monday for an I.P.O., paving the way for private equity firm Kohlberg Kravis Roberts (K.K.R.) to sell its majority stake after buying the company for $29 billion 8 years ago. The deal was one of the last big leveraged buyouts before the financial crisis in 2008, and K.K.R. is finally looking to exit from one of the most debt-laden agreements in recent years. Currently, Renaissance Capital estimated First Data could raise $5 billion in its initial offering, as the company plans to the use proceeds from the stock sale to repay a portion of its $20 billion long-term debt. While First Data claims some 4,000 financial institutions as clients globally, and boasts a revenue of $11.1 billion, the company lost $265 million in 2014.
Toshiba Executives Quit Amid Earnings Scandal
Top executives at Japanese electronics firm Toshiba have stepped down amid an accounting scandal, which has forced the company to state it will correct earnings figures by at least 152 billion yen ($1.2 billion). According to a third party report, the firm's current and previous presidents Hisao Tanaka and Norio Sasaki sought to delay booking losses, requiring recalculations and earnings cuts from more than 6 years. The largest single earnings figure to be corrected is 85.8 billion yen of pretax profile in 2012; an internal probe also found inaccurate entries totaling 4.4 billion yen for that fiscal year. The company's stock has fallen 20% since the probe was first announced on May 8th.
Sources:
http://www.bloomberg.com/news/articles/2015-07-21/toshiba-to-correct-profit-after-executives-set-unrealistic-goals
http://www.marketwatch.com/story/big-fund-suspected-of-selling-gold-as-price-crashes-to-five-year-low-2015-07-20
http://www.nytimes.com/2015/07/21/business/dealbook/first-data-ipo-is-likely-to-be-one-of-years-largest.html
http://www.nytimes.com/2015/07/21/business/federal-reserve-finalizes-capital-restraints-for-big-banks.html
Monday, July 20, 2015
Thursday, July 9, 2015
U.S. Stock Futures, Commodities ETFs, NYC's Real Estate and P.&G. Selloff
U.S. Stock Futures and Euro Advances Following New Greek Proposal
U.S. stock futures and the euro gained after the Greek government announced a bailout proposal in the form of at least 53.5 billion euros ($59.2 billion) over 3 years. S&P 500 muni futures rose 1% to 2061.75 before settling up 0.9% at 2058.5. Meawhile, the euro advanced 0.2% to $1.1061 as the dollar moved up to $121.71 against the yen. The new Greek deal seeks to offer reforms and spending cuts through pension savings and tax increased - similar to the previous deal presented by the creditors on June 26th. However, analysts continue to monitor market health as they wait to see if stocks in Shanghai will recover.
Commodities ETFs Fall Through First Half of 2015
Metals and soft commodities have taken up 9 of the 10 Worst Performing ETFs list featured on ETF.com. The list includes ETFS Physical Palladium, down -15.92% as South African supplies recover from strikes in 2014; Teucrium Sugar down -20.12%; iPath Pure Beta Nickel ETN down -21.32% after Indonesia - once the largest supplier of nickel ore - banned exported of ore in 2014 in order to build up its own smelting and processing industry; iPath Pure Beta Coffee ETN down -26.18% as Brazil struggles to recover from last year's record drought. Lastly, the number 1 spot goes to the iPath Bloomberg Natural Gas Subindex Total Returns ETN, down -36.82%, as the ETN closes the gap on trading at premiums against its NAV in the past several years.
Real Estate Values Soar Near Manhattan
As Manhattan apartments reach record highs in price, homeowners move toward the outer boroughs for prospective sales. As a result, real estate values rise in areas outside Manhattan. The average price of a Queens condo jumped 20% over the past year, to $575, 229. Meanwhile, the Long Island City neighborhood has advanced 28% to an average price of $1.06 million. However, prices in Brooklyn rise 0.7% to $788,529, as the borough remains a popular alternative to the more expensive Manhattan. While 66% of apartment listings in Manhattan are listed at above $1 million, of 22% have breached this threshold in Brooklyn. Success of real estate markets have continued expanding in New York City. Properties in Brooklyn spend an average of 73 days on the market, 33% less than a year earlier.
Procter & Gamble Sells 43 Beauty Brands for $12.5 Billion
Consumer products firm Procter & Gamble has agreed to sell 43 beauty brands to beauty products manufacturer Coty for $12.5 billion. The deal includes products such as Gucci and Dolce & Gabbana perfumes, and VS Salonist hair products. It reflects P.&G.'s plan to remove over 100 brands and instead focus on a core product line, such as its Tide products. In November 2014, P.&G. struck an agreement with Bershire Hathaway to sell Duracell in a $4.7 billion stock deal. For the latest transaction, the selloff will be structured with a tax-efficient spinoff, in which the new entity will then merge with Coty. Following the announcement, Coty's shares closed down $1.48 (4.7% ) to $30.04, while P.&G. fell 33 cents (0.4%) to $80.66.
Sources:
http://www.bloomberg.com/news/articles/2015-07-09/greeks-under-gun-to-produce-a-reform-plan-to-keep-euro-ibwl1vjy
http://www.bloomberg.com/news/articles/2015-07-09/queens-condos-set-record-as-manhattan-buyers-priced-out
http://www.etf.com/sections/features-and-news/worst-10-commodity-etfs-2015?nopaging=1
http://www.nytimes.com/2015/07/10/business/dealbook/pg-sells-43-beauty-brands-to-coty.html
http://www.reuters.com/article/2015/07/10/us-markets-global-idUSKCN0PJ2ZW20150710
U.S. stock futures and the euro gained after the Greek government announced a bailout proposal in the form of at least 53.5 billion euros ($59.2 billion) over 3 years. S&P 500 muni futures rose 1% to 2061.75 before settling up 0.9% at 2058.5. Meawhile, the euro advanced 0.2% to $1.1061 as the dollar moved up to $121.71 against the yen. The new Greek deal seeks to offer reforms and spending cuts through pension savings and tax increased - similar to the previous deal presented by the creditors on June 26th. However, analysts continue to monitor market health as they wait to see if stocks in Shanghai will recover.
Commodities ETFs Fall Through First Half of 2015
Metals and soft commodities have taken up 9 of the 10 Worst Performing ETFs list featured on ETF.com. The list includes ETFS Physical Palladium, down -15.92% as South African supplies recover from strikes in 2014; Teucrium Sugar down -20.12%; iPath Pure Beta Nickel ETN down -21.32% after Indonesia - once the largest supplier of nickel ore - banned exported of ore in 2014 in order to build up its own smelting and processing industry; iPath Pure Beta Coffee ETN down -26.18% as Brazil struggles to recover from last year's record drought. Lastly, the number 1 spot goes to the iPath Bloomberg Natural Gas Subindex Total Returns ETN, down -36.82%, as the ETN closes the gap on trading at premiums against its NAV in the past several years.
Real Estate Values Soar Near Manhattan
As Manhattan apartments reach record highs in price, homeowners move toward the outer boroughs for prospective sales. As a result, real estate values rise in areas outside Manhattan. The average price of a Queens condo jumped 20% over the past year, to $575, 229. Meanwhile, the Long Island City neighborhood has advanced 28% to an average price of $1.06 million. However, prices in Brooklyn rise 0.7% to $788,529, as the borough remains a popular alternative to the more expensive Manhattan. While 66% of apartment listings in Manhattan are listed at above $1 million, of 22% have breached this threshold in Brooklyn. Success of real estate markets have continued expanding in New York City. Properties in Brooklyn spend an average of 73 days on the market, 33% less than a year earlier.
Procter & Gamble Sells 43 Beauty Brands for $12.5 Billion
Consumer products firm Procter & Gamble has agreed to sell 43 beauty brands to beauty products manufacturer Coty for $12.5 billion. The deal includes products such as Gucci and Dolce & Gabbana perfumes, and VS Salonist hair products. It reflects P.&G.'s plan to remove over 100 brands and instead focus on a core product line, such as its Tide products. In November 2014, P.&G. struck an agreement with Bershire Hathaway to sell Duracell in a $4.7 billion stock deal. For the latest transaction, the selloff will be structured with a tax-efficient spinoff, in which the new entity will then merge with Coty. Following the announcement, Coty's shares closed down $1.48 (4.7% ) to $30.04, while P.&G. fell 33 cents (0.4%) to $80.66.
Sources:
http://www.bloomberg.com/news/articles/2015-07-09/greeks-under-gun-to-produce-a-reform-plan-to-keep-euro-ibwl1vjy
http://www.bloomberg.com/news/articles/2015-07-09/queens-condos-set-record-as-manhattan-buyers-priced-out
http://www.etf.com/sections/features-and-news/worst-10-commodity-etfs-2015?nopaging=1
http://www.nytimes.com/2015/07/10/business/dealbook/pg-sells-43-beauty-brands-to-coty.html
http://www.reuters.com/article/2015/07/10/us-markets-global-idUSKCN0PJ2ZW20150710
Wednesday, July 8, 2015
NYSE Glitch, Private Equity Funds, Oil Futures and Microsoft's Nokia
NYSE Glitch Not A Showstopper for Market Activity
Despite over 3 hours of trading suspension on the New York Stock Exchange (NYSE) due to a software bug today, markets proved to be resilient and was not significantly impacted. For example, investors were still able to trade I.B.M. or Target shares, which are listed on the NYSE. The lack of impact shows the growing complexity of the U.S. stock market and thus its ability to become robust. Part of this is attributed to the increasing number of private stock trading platforms - dark pools - which allow investors to trade without affecting the broader markets. Dark pools now make up 40% of all stock trading volume. The fragmentation of markets is also a factor; today, NYSE and Nasdaq account for 24% and 19% of the volume, respectively. In contrast, the 2 exchanges handled 80% in 1997.
Private Equity Firm K.K.R. Raises $3.1 Billion for Infrastructure Investments
Kohlberg Kravis Roberts stated that it has raised $3.1 billion for a new fund to invest in infrastructure projects, such as roads, water systems and energy pipelines. The announcement reflects growing interest of private equity firms toward infrastructure improvement, as it can offer steady cashflows for multiple years. Despite political opposition and lack of funds by local governments for such projects, the investment companies have taken part on less visible projects such as renewable energy plants. This new fund is the second to K.K.R. to be focused on infrastructure; the firm raised $1 billion in 2012.
Oil Futures Decline By Over 1%
Despite over 3 hours of trading suspension on the New York Stock Exchange (NYSE) due to a software bug today, markets proved to be resilient and was not significantly impacted. For example, investors were still able to trade I.B.M. or Target shares, which are listed on the NYSE. The lack of impact shows the growing complexity of the U.S. stock market and thus its ability to become robust. Part of this is attributed to the increasing number of private stock trading platforms - dark pools - which allow investors to trade without affecting the broader markets. Dark pools now make up 40% of all stock trading volume. The fragmentation of markets is also a factor; today, NYSE and Nasdaq account for 24% and 19% of the volume, respectively. In contrast, the 2 exchanges handled 80% in 1997.
Private Equity Firm K.K.R. Raises $3.1 Billion for Infrastructure Investments
Kohlberg Kravis Roberts stated that it has raised $3.1 billion for a new fund to invest in infrastructure projects, such as roads, water systems and energy pipelines. The announcement reflects growing interest of private equity firms toward infrastructure improvement, as it can offer steady cashflows for multiple years. Despite political opposition and lack of funds by local governments for such projects, the investment companies have taken part on less visible projects such as renewable energy plants. This new fund is the second to K.K.R. to be focused on infrastructure; the firm raised $1 billion in 2012.
Oil Futures Decline By Over 1%
Crude futures in the U.S. fell over 1% on Wednesday as the U.S. Energy Information Administration announced that stockpiles had increased for crude, gasoline and distillates. The statement surprised investors, who were expecting oil inventories to decrease. The news adds to current worries on Greek debt, possibility of Iran to re-enter the oil market, and China's equity plunge, all of which has had a negative impact on the commodity. Earlier in the week, oil prices had fallen to a 3-month low. However, as crude fell, gasoline rallied due to expectations for high fuel demand through the summer driving season.
Microsoft Writes Off Nokia a $7.6 Billion
Software giant Microsoft has decided to write off its acquisition of Nokia, a $9.5 billion deal made by the previous CEO Steve Ballmer. The agreement had included $1.5 billion of acquired cash and $2 billion to license Nokia's patents. However, Microsoft has deemed the acquirement a failure, as 7,800 personnel are being laid off along with the write-off. Microsoft's write-downs for M&A deals now total at about $14 billion over the past 3 years, including $6.3 billion for digital advertising agency aQuantive. Nevertheless, current CEO Satya Nadella has also followed Ballmer's footsteps to acquire external growth, as he spent over $2 billion on Minecraft maker Mojang last year.
Sources:
http://blogs.reuters.com/breakingviews/2015/07/08/microsoft-gets-7-6-bln-wakeup-call-from-nokia/
http://www.nytimes.com/2015/07/09/business/dealbook/an-offline-nyse-makes-barely-a-ripple-in-a-days-trading.html
http://www.nytimes.com/2015/07/09/business/dealbook/kkr-raises-3-1-billion-to-invest-in-road-and-other-infrastructure-projects.html
http://www.nytimes.com/2015/07/09/business/dealbook/an-offline-nyse-makes-barely-a-ripple-in-a-days-trading.html
http://www.nytimes.com/2015/07/09/business/dealbook/kkr-raises-3-1-billion-to-invest-in-road-and-other-infrastructure-projects.html
Tuesday, July 7, 2015
Chinese Trade Halts, BRICS' Reserve, Horizon's Offer, and Financial Scams
Chinese Firms Halt Trading
About 745 Chinese companies - comprising 26% of firms listed on mainland Chinese exchanges - have suspended trading in response to the recent selloffs that have caused market downfalls in the country. The suspensions halt movement of $1.4 trillion of shares, representing 21% of China's market capitalization. Meanwhile, the Shanghai Composite Index has already fallen 28% since its June 12 peak value. The rout has always erased $3.2 billion in China's markets, equivalent to twice the size of India's entire stock market. Companies such as Searainbow Holding Corp. in Shenzhen has lost 54% in the past 3 weeks, after rising 150% in the year thru June 11.
Russia Contributes $18 Billion to BRICS Reserves Pool
The central banks of Brazil, Russia, India, China and South Africa (BRICS) have signed an agreement on Tuesday to create a reserve pool to provide source of liquidity for the member nations in times of trouble. Worth $100 billion (the fund is denominated in U.S. dollars), China will contribute $41 billion, while B, I and R will provide $18 billion, and South Africa $5 billion. Elvira Nabiullina, governor of Russia's central bank, has stated that the contribution will not reduce the country's official reserves, as the amount comes from Russia's gold and forex reserves. As of end of June, Russia's gold and forex pools stood at $362 billion.
Horizon Pharma Makes Offer of $3 Billion to Depomed
Irish drug maker Horizon Pharma announced it had made an offer to acquire American manufacturer company Depomed for $3 billion, all in shares. While Depomed has so far rejected the proposal, which is valued at $29.25 per share, 42% above Depomed's closing mark of $20.64 on Monday. Horizon Pharma had previously acquired Vidara Therapeutics International for $660 million and California-based Hyperion Therapeutics for $1.1 billion. The mergers reflect current trends in the health care sector, as pharmaceutical companies look to increase strategic and financial value.
London Hedge Fund Lost $1.2 Million in Phone Scam
Hedge fund Fortelus Capital Management LLP lost 742,668 pounds ($1.2 million) after its CFO, Thomas Meston, was conned into providing securities code to who he thought was Coutts, the fund's bank. The scam happened on a Friday afternoon phone call, when Meston was warned of fraudulent activity on the fund's account. Meston has since been fired by the firm and sued by Fortelus for breaching his responsibilities. The event highlights the vulnerability of online security systems, as the Bank of England noted that cyber crime was growing threat to the financial industry. Similar cases have cropped up, as with Zurich Insurance Group AG, where fraud caused a loss of 5 million pounds over 3 months.
Sources:
http://www.bloomberg.com/news/articles/2015-07-07/chinese-trading-halts-freeze-1-4-trillion-of-shares-amid-rout
http://www.bloomberg.com/news/articles/2015-07-07/friday-afternoon-scam-cost-hedge-fund-1-2-million-and-cfo-s-job
http://www.nytimes.com/2015/07/08/business/dealbook/horizon-pharma-offers-to-buy-depomed-for-3-billion.html
http://www.reuters.com/article/2015/07/07/us-emerging-brics-russia-cenbank-idUSKCN0PH1L820150707
About 745 Chinese companies - comprising 26% of firms listed on mainland Chinese exchanges - have suspended trading in response to the recent selloffs that have caused market downfalls in the country. The suspensions halt movement of $1.4 trillion of shares, representing 21% of China's market capitalization. Meanwhile, the Shanghai Composite Index has already fallen 28% since its June 12 peak value. The rout has always erased $3.2 billion in China's markets, equivalent to twice the size of India's entire stock market. Companies such as Searainbow Holding Corp. in Shenzhen has lost 54% in the past 3 weeks, after rising 150% in the year thru June 11.
Russia Contributes $18 Billion to BRICS Reserves Pool
The central banks of Brazil, Russia, India, China and South Africa (BRICS) have signed an agreement on Tuesday to create a reserve pool to provide source of liquidity for the member nations in times of trouble. Worth $100 billion (the fund is denominated in U.S. dollars), China will contribute $41 billion, while B, I and R will provide $18 billion, and South Africa $5 billion. Elvira Nabiullina, governor of Russia's central bank, has stated that the contribution will not reduce the country's official reserves, as the amount comes from Russia's gold and forex reserves. As of end of June, Russia's gold and forex pools stood at $362 billion.
Horizon Pharma Makes Offer of $3 Billion to Depomed
Irish drug maker Horizon Pharma announced it had made an offer to acquire American manufacturer company Depomed for $3 billion, all in shares. While Depomed has so far rejected the proposal, which is valued at $29.25 per share, 42% above Depomed's closing mark of $20.64 on Monday. Horizon Pharma had previously acquired Vidara Therapeutics International for $660 million and California-based Hyperion Therapeutics for $1.1 billion. The mergers reflect current trends in the health care sector, as pharmaceutical companies look to increase strategic and financial value.
London Hedge Fund Lost $1.2 Million in Phone Scam
Hedge fund Fortelus Capital Management LLP lost 742,668 pounds ($1.2 million) after its CFO, Thomas Meston, was conned into providing securities code to who he thought was Coutts, the fund's bank. The scam happened on a Friday afternoon phone call, when Meston was warned of fraudulent activity on the fund's account. Meston has since been fired by the firm and sued by Fortelus for breaching his responsibilities. The event highlights the vulnerability of online security systems, as the Bank of England noted that cyber crime was growing threat to the financial industry. Similar cases have cropped up, as with Zurich Insurance Group AG, where fraud caused a loss of 5 million pounds over 3 months.
Sources:
http://www.bloomberg.com/news/articles/2015-07-07/chinese-trading-halts-freeze-1-4-trillion-of-shares-amid-rout
http://www.bloomberg.com/news/articles/2015-07-07/friday-afternoon-scam-cost-hedge-fund-1-2-million-and-cfo-s-job
http://www.nytimes.com/2015/07/08/business/dealbook/horizon-pharma-offers-to-buy-depomed-for-3-billion.html
http://www.reuters.com/article/2015/07/07/us-emerging-brics-russia-cenbank-idUSKCN0PH1L820150707
Monday, July 6, 2015
Largest Metro Economies, HK Stocks, Oil Futures and Warren Buffett's Donation
Analysis Determines Scope of Largest Cities to Impact Global Economy
A new study by the Brookings Institution has identified 100 metropolitan across the world which accounts for 20% of the global economy, worth $22 trillion in 2014. of the 100 centers, 49 are in China, 19 in Japan, South Korea and Taiwan, 12 in North America, 7 in Southeast Asia, 7 in Latin America and 6 in Australia/New Zealand. As large regions of Asia continue to urbanize and industrialize, major metro economies will play a significant role in trade and investments. Of all the cities listed, Chinese cities saw the fastest per-capita GDP growth.
Hong Kong Experiences Fall of Chinese Stocks
The Hang Seng broad index of Hong Kong fell 3.2% on Monday, as the Hang Seng 100-large-mainland-companies index dropped 3.7%. While the Chinese government has intervened to ease the slide in mainland China, tighter restrictions and corporate governance rules have prevented such actions to be taken in Hong Kong. As such, foreign investors have been selling their HK shares in response to mainland China's market developments. There is the suggestion that foreign investors believe the Chinese government has intervened too much; so far, 21 mainland brokerage firms have set up a $19.4 billion fund to buy the larger companies' shares. This support is reflected in a noticeable rally for large-company firms in Shanghai and Shenzhen. The CSI 300 index of large-caps gained 2.9% at closing.
Oil Futures at 3-Month Low
August 2015 crude prices fell $4.40 (7.7%) to $52.53 per barrel on NYMEX (New York Mercantile Exchange), signaling the largest drop since April 13. Possible causes point to the latest news in Greek (where the referendum concluded in a "No" response to accepting current bailout terms) and possibility that a nuclear deal with Iran could lead to an increase in oil supplies. Analysts also point to the recent fall of Chinese equities that may suggest a weaker demand for oil.
Warren Buffett Continues Summer Trend of Donations
Warren Buffett has once again announced he will be donating a portion of his wealth to charity. This summer, the amount is over $2.8 billion, which comes from 20.64 million Berkshire Hathaway class b shares. The stock closed at $137.39 per share on Thursday, totaling $2.84 billion. The major recipients - as has been the case for a decade - is the Bill and Melinda Gates Foundation and the foundations of Buffett's family members. Following this summer's donation, Buffett's worth decreases to $64.5 billion. In the previous two summers, Buffett donated amounts of $2.6 billion and $2.8 billion, as he pledged to give away 99% of his wealth during his lifetime.
Sources:
http://www.bloomberg.com/news/articles/2015-07-06/the-cities-that-make-up-the-biggest-economy-on-earth
http://www.forbes.com/sites/alexmorrell/2015/07/06/warren-buffett-unleashes-another-2-8-billion-donation/
http://www.marketwatch.com/story/oil-tumbles-4-after-greek-voters-reject-creditors-reform-proposal-2015-07-06
http://www.nytimes.com/2015/07/07/business/international/chinese-share-sell-off-spills-over-to-hong-kong.html
A new study by the Brookings Institution has identified 100 metropolitan across the world which accounts for 20% of the global economy, worth $22 trillion in 2014. of the 100 centers, 49 are in China, 19 in Japan, South Korea and Taiwan, 12 in North America, 7 in Southeast Asia, 7 in Latin America and 6 in Australia/New Zealand. As large regions of Asia continue to urbanize and industrialize, major metro economies will play a significant role in trade and investments. Of all the cities listed, Chinese cities saw the fastest per-capita GDP growth.
Hong Kong Experiences Fall of Chinese Stocks
The Hang Seng broad index of Hong Kong fell 3.2% on Monday, as the Hang Seng 100-large-mainland-companies index dropped 3.7%. While the Chinese government has intervened to ease the slide in mainland China, tighter restrictions and corporate governance rules have prevented such actions to be taken in Hong Kong. As such, foreign investors have been selling their HK shares in response to mainland China's market developments. There is the suggestion that foreign investors believe the Chinese government has intervened too much; so far, 21 mainland brokerage firms have set up a $19.4 billion fund to buy the larger companies' shares. This support is reflected in a noticeable rally for large-company firms in Shanghai and Shenzhen. The CSI 300 index of large-caps gained 2.9% at closing.
Oil Futures at 3-Month Low
August 2015 crude prices fell $4.40 (7.7%) to $52.53 per barrel on NYMEX (New York Mercantile Exchange), signaling the largest drop since April 13. Possible causes point to the latest news in Greek (where the referendum concluded in a "No" response to accepting current bailout terms) and possibility that a nuclear deal with Iran could lead to an increase in oil supplies. Analysts also point to the recent fall of Chinese equities that may suggest a weaker demand for oil.
Warren Buffett Continues Summer Trend of Donations
Warren Buffett has once again announced he will be donating a portion of his wealth to charity. This summer, the amount is over $2.8 billion, which comes from 20.64 million Berkshire Hathaway class b shares. The stock closed at $137.39 per share on Thursday, totaling $2.84 billion. The major recipients - as has been the case for a decade - is the Bill and Melinda Gates Foundation and the foundations of Buffett's family members. Following this summer's donation, Buffett's worth decreases to $64.5 billion. In the previous two summers, Buffett donated amounts of $2.6 billion and $2.8 billion, as he pledged to give away 99% of his wealth during his lifetime.
Sources:
http://www.bloomberg.com/news/articles/2015-07-06/the-cities-that-make-up-the-biggest-economy-on-earth
http://www.forbes.com/sites/alexmorrell/2015/07/06/warren-buffett-unleashes-another-2-8-billion-donation/
http://www.marketwatch.com/story/oil-tumbles-4-after-greek-voters-reject-creditors-reform-proposal-2015-07-06
http://www.nytimes.com/2015/07/07/business/international/chinese-share-sell-off-spills-over-to-hong-kong.html
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