What You Need To Know This Week — July 27th, 2019
What You Need To Know This Week
A weekly recap to keep you informed on the most important events this week impacting markets, business, tech and the global economy.
T-MOBILE AND SPRINT WIN ANTITRUST APPROVAL FOR MERGER
The antitrust regulator, the U.S. Department of Justice, stated that it is approving T-Mobile’s $26 billion merger with rival Sprint. The approval came after the parties agreed to divest assets to Dish Network in an effort to create a new fourth competitor in the wireless space.
CANNTRUST FIRES CEO AND CHAIRMAN RESIGNS AS SCANDAL AT THE CANNABIS FIRM DEEPENS
Embattled Cannabis firm, CannTrust, fired its two most senior officials, including CEO Peter Aceto, after media reports indicated that the executives knew of the company’s illegal production of unlicensed cannabis. The company’s Chairman and co-founder, Eric Paul, also stepped-down after facing demands from the company to resign.
U.S. ECONOMY GROWS AT 2.1% IN Q2, BEATING EXPECTATIONS
The U.S. economy grew at 2.1% annualized in the second quarter, beating economist expectations of 1.8% growth. The strong economic growth numbers come amidst the expectation that the Fed cut rates next week.
ECB SIGNALS UPCOMING RATE CUT AND POTENTIAL RELAUNCH OF MONETARY STIMULUS
The European Central Bank president Mario Draghi signaled that they are preparing to cut interest rates for the first time since 2016, while indicating a restart of its bond-buying program. The stimulus measures aim to reinvigorate the struggling eurozone economy.
REGULATOR OPENS REVIEW INTO BIG TECH FIRMS’ MARKET POWER
The Department of Justice announced a broad investigation in leading online platforms to see if they have been “engaging in practices that have reduced competition, stifled innovation or otherwise harmed consumers”. The regulator did not name the companies subject to the investigation, however it is speculated that the focus would be on Amazon, Facebook and Google.
Recommended Articles, Podcasts, Books and Tweets
Listen to Why Merger Arb Works on AQR’s Curious Investor podcast.
Alphabet shares rallied 10.5% after releasing its second quarter results, which handily beat sell-side estimates. This was the Google parent’s largest one-day share price gain in four years.
Facebook posted 28% year-over-year revenue growth in its second quarter financial results.
Softbank unveiled its second Vision Fund, in which it expects to gather $108 billion in commitments. The Fund will make large investments into private technology companies.
Millennial-focused free stock trading app Robinhood raised $323 million at a $7.6 billion valuation to continue its expansion.
The IMF lowered its global economic growth forecast by 0.1% for 2019 and 2020, blaming the U.S.-China trade war and Brexit uncertainties.
The White House and Congress reached a deal to lift the debt ceiling, kicking the can down the road for two more years.
Private equity firm Catalyst Capital has raised the stakes in the Hudson’s Bay go-private battle, offering to purchase $150 million of HBC shares at a 7% premium to the $9.45 bid offered by insiders.
Bridgewater’s Pure Alpha, one of the largest hedge funds globally, is down -4.9% year-to-date.
SNC-Lavalin’s largest shareholder, pension fund Caisse, called for “decisive” action as the embattled construction firm continues to deteriorate.
How did Wheaton, Ill., a town of 53,000 people, become a hub in the fast-growing ETF market?
-The Accelerate Team
