Business

Stocks Moving in an Upward Trend as Coronavirus Fears Eases

There are signs the coronavirus outbreak may be easing and investors will be looking to see if a two-week stock rally has legs. The decline in the oil price sinks one of the world’s most secretive fuel-trading companies that ratcheted $800 million in losses. Here are some of the things people in markets are talking about today.

Possible Aid for Small Business

New York’s virus outbreak may have begun “a descent” as the rates of new infections and deaths slow in the state. Governor Andrew Cuomo said Sunday that New York appeared to be “on the other side” of the outbreak. The death tally in the U.S. topped 40,000. A deal on new U.S. aid for small businesses could be days away.

The first sign of easing emerged in Europe as hard-hit Italy, Spain and France reported the smallest increases in fatalities in week. Germany is letting smaller stores, car dealerships, bike shops and bookstores reopen Monday.

Still, social restrictions imposed to curb the virus must be eased in phases and don’t spell the end of the epidemic, World Health Organization Director-General Tedros Adhanom Ghebreyesus said. Singapore now has the most cases in Southeast Asia, overtaking Indonesia after the city-state detected hundreds more victims among low-wage foreign workers.

But a government minister said foreign workers in Singapore know they are currently safer in the city-state than elsewhere including their own countries. Follow the latest developments here.

Stock Market Open

U.S. equity futures retreated in early trading Monday as investors looked toward a busy week for corporate earnings amid signs of an easing in the global coronavirus spread. Currency markets began the week with little fanfare and stocks in Asia were headed for a mixed start as the coronavirus pandemic showed signs of easing in some of the world’s key hot spots.

The dollar and Treasuries were steady as New York Governor Andrew Cuomo said the state may be past the high point of coronavirus deaths. Oil dropped to an 18-year low after production cuts agreed by top producers last week were seen barely making a dent in the demand destruction wrought by Covid-19. On Friday U.S. stocks posted a second straight week of gains while Treasuries fell, with 10-year yields up two basis points.

Meantime, earnings season will provide investors with a look at just how much the pandemic has impacted businesses. IBM, Infosys and China Mobile kick things off on Monday, followed by Coca-Cola and Netflix.

Hiding a $800 Million Stock Loss

The son of the legendary founder of Hin Leong Trading said the Singapore oil trader hid about $800 million in losses racked up in futures trading, suggesting a much bigger hole in the company’s finances than thought, according to people with knowledge of the matter.

The downfall of Hin Leong, one of the biggest and most secretive forces in the world of physical fuel-oil trading, shows the depth of the fallout from the dramatic drop in oil prices so far this year as a consequence of the Saudi-Russia price war and the coronavirus pandemic. Lim Chee Meng, the only son of Lim Oon Kuin, said the company also sold some of the million of barrels of refined products it had used as collateral to secure loans from its banks, according to the people.

As a result, the company faces a significant shortfall between the oil stocks it held and the inventories pledged to its banks. Hin Leong and Ocean Tankers both filed for court protection from creditors on Friday as the former struggles to repay its debts.

Current-Account Panacea

A historic shift in Australia’s current account from perennial vulnerability to source of strength may prove to be just enough to save the nation’s top credit rating from a budget blowout. Australia recorded its first current-account surplus in 44 years in the second quarter of 2019 and remained in the black for the ensuing two quarters.

There are indications it should remain close to balance and could help stave off a downgrade, as S&P Global Ratings acknowledged when it cut Australia’s AAA credit rating outlook to negative this month. The current account’s return to surplus last year was a function of surging resource revenues and an upward trend in services exports that strengthened the trade balance.

Money Taboo

The coronavirus economy is shredding records for government borrowing and central-bank lending. Soon it may also smash the taboo that’s supposed to keep those two things apart. Governments paying for budget spending with loans from their own central banks is known as monetary financing.

The risk, repeated throughout history, is that it becomes a slippery slope in which politicians ride roughshod over central-bank independence, triggering runaway inflation as they splash what feels like free cash around the economy.

The stricture against direct financing has held up even through a series of crises when central bankers did in fact buy plenty of public debt. They just made sure to do it in a roundabout way, snapping up bonds. But in a pandemic that’s placing unprecedented demands on budgets — and could strain the capacity of bond markets to finance them — some monetary experts say it’s time for exactly this kind of break-the-glass policy.

Source: Bloomberg

Business

PepsiCo Reduces Revenue Projections As North American Snacks And Key International Markets Underperform.

(VOR News) – In the third quarter of this year, Pepsi’s net income was $2.93 billion, which is equivalent to $2.13 per share. This was attributed to the company.

This is in stark contrast to net income of $3.09 billion, which is equivalent to $2.24 per share, during the same period in the previous year. The company’s earnings per share were $2.31 when expenses were excluded.

Net sales decreased by 0.6%, totaling $23.32 billion. Organic sales increased by 1.3% during the quarter when the effects of acquisitions, divestitures, and currency changes are excluded.

Pepsi’s beverage sales fell this quarter.

The most recent report indicates that the beverage and food sectors of the organization experienced a 2% decline in volume. Consumers of all income levels are demonstrating a change in their purchasing habits, as indicated by CEOs’ statements from the previous quarter.

Pepsi’s entire volume was adversely affected by the lackluster demand they encountered in North America. An increasing number of Americans are becoming more frugal, reducing the number of snacks they ingest, and reducing the number of times they purchase at convenience stores.

Furthermore, Laguarta observed that the increase in sales was partially attributed to the election that occurred in Mexico during the month of June.

The most significant decrease in volume was experienced by Quaker Foods North America, which was 13%. In December, the company announced its initial recall in response to a potential salmonella infection.

Due to the probability of an illness, the recall was extended in January. Pepsi officially closed a plant that was implicated in the recalls in June, despite the fact that manufacturing had already been halted.

Jamie Caulfield, the Chief Financial Officer of Pepsi and Laguarta, has indicated that the recalls are beginning to have a lessening effect.

Frito-Lay experienced a 1.5% decline in volume in North America. The company has been striving to improve the value it offers to consumers and the accessibility of its snack line, which includes SunChips, Cheetos, and Stacy’s pita chips, in the retail establishments where it is sold.

Despite the fact that the category as a whole has slowed down in comparison to the results of previous years, the level of activity within the division is progressively increasing.

Pepsi executives issued a statement in which they stated that “Salty and savory snacks have underperformed year-to-date after outperforming packaged food categories in previous years.”

Pepsi will spend more on Doritos and Tostitos in the fall and winter before football season.

The company is currently promoting incentive packets for Tostitos and Ruffles, which contain twenty percent more chips than the standard package.

Pepsi is expanding its product line in order to more effectively target individuals who are health-conscious. The business announced its intention to acquire Siete Foods for a total of $1.2 billion approximately one week ago. The restaurant serves Mexican-American cuisine, which is typically modified to meet the dietary needs of a diverse clientele.

The beverage segment of Pepsi in North America experienced a three percent decrease in volume. Despite the fact that the demand for energy drinks, such as Pepsi’s Rockstar, has decreased as a result of consumers visiting convenience stores, the sales of well-known brands such as Gatorade and Pepsi have seen an increase throughout the quarter.

Laguarta expressed his opinion to the analysts during the company’s conference call, asserting, “I am of the opinion that it is a component of the economic cycle that we are currently experiencing, and that it will reverse itself in the future, once consumers feel better.”

Additionally, it has been noted that the food and beverage markets of South Asia, the Middle East, Latin America, and Africa have experienced a decline in sales volume. The company cut its forecast for organic revenue for the entire year on Tuesday due to the business’s second consecutive quarter of lower-than-anticipated sales.

The company’s performance during the quarter was adversely affected by the Quaker Foods North America recalls, the decrease in demand in the United States, and the interruptions that occurred in specific international markets, as per the statements made by Chief Executive Officer Ramon Laguarta.

Pepsi has revised its forecast for organic sales in 2024, shifting from a 4% growth rate to a low single-digit growth rate. The company reiterated its expectation that the core constant currency profitability per share will increase by a minimum of 8% in comparison to the previous year.

The company’s shares declined by less than one percent during premarket trading. The following discrepancies between the company’s report and the projections of Wall Street were identified by LSEG in a survey of analysts:

SOURCE: CNBC

Business

Old National Bank And Infosys Broaden Their Strategic Partnership.

(VOR News) – Old National Bank, a commercial bank with its headquarters in the Midwest, and Infosys, a firm that specializes in information technology, have recently entered into a strategic expansion of their link, which has been in place for the past four years.

This expansion is more likely to take place sooner rather than later, with the likelihood being higher.

For the purpose of making it possible for Old National Bank to make use of the services, solutions, and platforms that are offered by Infosys, the objective of this expansion is to make it possible for the bank to transform its operations and processes through the application of automation and GenAI, as well as to change significant business areas.

This lets the bank leverage Infosys’ services, solutions, and platforms.

Old National Bank Chairman and CEO Jim Ryan said, “At Old National, we are committed to creating exceptional experiences for both our customers and our fellow employees.”

This statement is applicable to Old National Bank. Infosys is carefully managing the business process innovations that it is putting us through, putting a strong emphasis on efficiency and value growth throughout the process to ensure that it is carried out efficiently.

This is a routine occurrence throughout the entire operation. Because of Infosys’ dedication to our development and success, we are incredibly appreciative of the assistance they have provided.

Old National has been receiving assistance from Infosys in the process of updating its digital environment since the year 2020, according to the aforementioned company.

Ever since that time, the company has been providing assistance. The provision of this assistance has been accomplished through the utilization of a model that is not only powerful but also capable of functioning on its own power.

Infosys currently ranks Old National thirty-first out of the top thirty US banks.

This ranking is based on the fact that Old National is the nation’s largest banking corporation.

It is estimated that the total value of the company’s assets is approximately fifty-three billion dollars, while the assets that are currently being managed by the organization are valued at thirty billion dollars.

Dennis Gada, the Executive Vice President and Global Head of Banking and Financial Services, stated that “Old National Bank and Infosys possess a robust cultural and strategic alignment in the development, management, and enhancement of enterprise-scale solutions to transform the bank’s operations and facilitate growth.”

This remark referenced the exceptional cultural and strategic synergy between the two organizations. Dennis Gada is the one who asserted this claim. This was articulated explicitly concerning the exceptional cultural congruence and strategy alignment of the two organizations.

We are pleased to announce that the implementation of Infosys Topaz will substantially expedite the transformation of Old National Bank’s business processes and customer service protocols. We are exceedingly enthusiastic about this matter. We are quite thrilled about this specific component of the scenario.

Medium-sized banks operating regionally will continue to benefit from our substantial expertise in the sector, technology, and operations. This specific market segment of Infosys will persist in benefiting from our extensive experience. This phenomenon will enable this market sector to sustain substantial growth and efficiency benefits.

SOURCE: THBL

Business

American Water, The Largest Water Utility In US, Is Targeted By A Cyberattack

The largest regulated water and wastewater utility company in the United States stated Monday that it had been the target of a cyberattack, forcing the company to halt invoicing to consumers.

American Water, The Largest Water Utility In US, Is Targeted By A Cyberattack

American Water, based in New Jersey and serving over 14 million people in 14 states and 18 military facilities, said it learned of the unauthorized activity on Thursday and quickly took precautions, including shutting down certain systems. The business does not believe the attack had an impact on its facilities or operations and said employees were working “around the clock” to determine the origin and scale of the attack.

water

The corporation stated that it has alerted legal enforcement and is cooperating with them. It also stated that consumers will not be charged late fees while its systems are unavailable.

According to their website, American Water operates over 500 water and wastewater systems in around 1,700 communities across California, Georgia, Hawaii, Illinois, Indiana, Iowa, Kentucky, Maryland, Missouri, New Jersey, Pennsylvania, Tennessee, Virginia, and West Virginia.

SOURCE | AP