In today’s top stories, Ørsted reveals plans to acquire Ostwind, Tesla hikes US prices and Binance mulls its $200bn Forbes investment. Meanwhile, a fund manager names undervalued stock picks and debt product ETFs are outperforming the markets.
Ørsted in talks over Ostwind deal
Ørsted, Denmark’s largest energy company and the world’s largest offshore wind power developer, confirmed on Thursday that it is in late-stage talks to acquire onshore wind power platform Ostwind, which operates in France and Germany. The deal forms part of Ørsted’s plans to expand onshore operations in Europe. The stock closed down 1.51% on Thursday.
Tesla hikes US prices
The EV maker announced plans on Thursday to raise prices on its Models S and Y by more than 4.5% each in the US on the back of rising aluminium prices and supply chain shocks. The news follows CEO Elon Musk’s warning of plans to cut staff by 10%. It’s been a difficult ride for EV makers of late, with Tesla, Lucid and NIO shares all slumping in premarket trading on Thursday after Jefferies analysts lowered EV sales estimates for this year and next.
Binance reconsiders $200bn Forbes investment
Binance CEO Changpeng Zhao said that the company’s plans to invest $200m in Forbes are “changing” after the SPAC deal was terminated at the end of last month. In an interview with Bloomberg TV, Zhao confirmed that they are “still in discussions” and that the firm remains committed to investing in traditional media outlets. Binance also pledged around $500m to support Elon Musk’s takeover of Twitter.
Fund manager names undervalued Chinese stocks
While China tech stocks have crashed so far this year, SC Asia fund manager Sid Choraria told CNBC on Wednesday that he’s betting on Alibaba and believes it is not a “value trap”. Choraria said that Alibaba’s five-to-10-year growth looks promising, particularly as the cloud computing division continues to grow — he expects its revenue business to be worth $25bn by 2025, up from $11bn.
Debt product ETFs benefit from rate hikes
With the news of another Fed rate hike, some funds that short segments of the US treasury market have benefitted from the increase. The ProShares Short 20+ Year Treasury ETF and ProShares Short 7–10 Year Treasury ETF have gained 31% and 14%, respectively, year-to-date. The iShares Floating Rate Bond ETF, Franklin Liberty Senior Loan ETF and SPDR Blackstone Senior Loan ETF are also outperforming the S&P 500.
Solar stocks on the rise
With traditional energy sources under increasing pressure, the US government’s decision on 6 June to suspend import tariffs on solar power equipment from a number of Southeast Asian importers caused solar stocks to soar last week. SunRun [RUN] closed the day 7% higher, Enphase Energy [ENPH] jumped 6% and SunPower [SPWR] and SolarEdge Technologies [SEDG] rose 4% and 3.5%, respectively.
Can Antofagasta bounce back?
The copper miner has had a positive year amid increased demand in the sector and claims that copper is “the new oil”. However, wider economic uncertainty, Covid-19 outbreaks in China and problems at key metal mines in Chile mean future growth for Antofagasta’s share price is not guaranteed. The stock is up 10.5% year-to-date but slumped 9.3% in the week to 15 June.
Disclaimer Past performance is not a reliable indicator of future results.
CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.
CMC Markets does not endorse or offer opinion on the trading strategies used by the author. Their trading strategies do not guarantee any return and CMC Markets shall not be held responsible for any loss that you may incur, either directly or indirectly, arising from any investment based on any information contained herein.
*Tax treatment depends on individual circumstances and can change or may differ in a jurisdiction other than the UK.