Amazon To Buy Whole Foods Market For $13.7 Billion

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Amazon announced on Friday that it would buy Whole Foods Market in a deal valued at $13.7 billion, and pay $42 a share for Texas-based grocery store chain in an all-cash deal that includes the group’s debt.

Whole Foods CEO John Mackey will stay as the CEO of the grocery store chain after the deal closes, and the store, the organic grocer that was founded in 1978, will keep operating under the Whole Foods brand as the deal is expected to be done in the second half year.

“This partnership presents an opportunity to maximize value for Whole Foods Market’s shareholders, while at the same time extending our mission and bringing the highest quality, experience, convenience and innovation to our customers,” Mackey said in a statement.

The deal sent a shocking reaction across both the online and brick-and-mortar industries, uniting two brands that weren’t seen as clear partners. But Whole Foods came under pressure to find a buyer this year after activist investor Jana Partners LLC acquired a stake and started pushing for a deal. Jana’s move annoyed Mackey, who has stated Whole Foods as his “baby.” With Amazon in the play, he gets to keep his job as CEO of the grocery chain.

In Whole Foods, it is acquiring a company that has recently come under pressure from investors for its lagging performance. Whole Foods, whose stores now numbers more than 430 locations, has struggled to appeal more mainstream consumers as Walmart and other large chains have stepped up their sales of natural and organic products.

“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” said Jeff Bezos, Amazon founder and CEO. “Whole Foods Market has been satisfying, delighting and nourishing customers for nearly four decades – they’re doing an amazing job and we want that to continue.”

Mackey said the he agreed to the deal because it is “an opportunity to maximize value” for the company’s shareholders.

Moreover, Amazon’s biggest acquisition so far came in 2014, when it agreed to buy video-game service Twitch Interactive Inc. for $970 million in cash. The Seattle-based company had about $21.5 billion of cash and equivalents at the end of March, the data show.

Whole Foods closed at $33.06 on Thursday. It opened at $34.85, with a session high of $34.97 and a session low of $32.97. Shares were halted in pre-market trading. Meanwhile, Amazon opened at $958.7 and closed at $964.17, with a session high of $965.73 and a session low of $950.86. Shares of Amazon rose 1.5% to $978.88 in pre-market trading.

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Gold rises due to Geopolitical tension

Rising tension surrounding the US, Russia and North Korea drove investors to turn to gold for their safe haven. Gold rose to a 5-month high on Wednesday, stretching its nearly 2 percent increases from the prior session as it benefits from safe haven flows.

The bullion is reaching its highest level since the week in November when President Donald Trump won the US election.

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Gold futures rose 0.1 percent to $1,276.75 an ounce on Wednesday. Other precious metals such as silver went up 0.4 percent to $18.33 while copper futures fell 1.2 percent to $2.577. Platinum fell back by 0.1 percent to $967.70 while palladium went down 1.4 percent to $791.52.

The US strike on Syria last Friday and Trump’s promise to solve the North Korean issue with or without China have raised anxiety about political stability, and there are also indications that Russia and US are in conflict over Afghanistan.

In the case of Afghanistan, US Defense Secretary James Mattis has expressed his concerns at Russia’s actions in the country along with claims that it has been building connections with the Taliban which has conducted a campaign against Afghan and NATO forces. The Kremlin denied the allegation of supporting the group.

North Korea alerted the media on Tuesday of a nuclear attack in case they saw any sign of attack from the US as the US Navy strike group or armada as President Trump described it steamed on the way to the western Pacific. Japan’s navy is also planning to join forces with the US navy.

Based on the current situation, it is said that the $1,307 target level for gold will be exceeded if the circumstances get worse. Serious escalation could put the bullion to the $1,380 to $1,400 area tout suite but it has to be really critical.

Secretary of State Rex Tillerson visited Italy on Tuesday with a message coming from joint world powers disapproving Russian support for Syria. The US-Russia relationship will be strictly watched as Sec. Tillerson visits Moscow on Wednesday.

Meanwhile, yen also received a boost being that is also a favored refuge in times of trouble since Japan is recognized as the world’s largest creditor nation and since it gets its gain from safe haven demand.

The dollar rose 0.1 percent to 109.72 yen while the euro climbed 0.1 percent to 116.42 yen on Wednesday.

Whereas the Dow Jones Industrial (DJI) average dropped 0.09 percent to $20,631 while S&P 500 futures lose 0.2 percent to $2,346 and the Nasdaq futures sank 0.1 percent to $5,394. US dollar index fell 0.04 percent to $100.59 as of Wednesday 13:43 GMT.

Analysts expect companies’ profits for all S&P 500 to have grown 10 percent in the first quarter from a year ago.

Oil also received a boost on Wednesday after its draw back from five-week highs hit earlier in the day. Brent oil futures edged up 0.3 percent to $56.38 per barrel breaking its winning streak of six-session while crude got its five-week high of 0.3 percent to $53.59 a barrel.

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Australia Stocks Decreases at Close of Trade; S&P/ASX 200 Drop 0.12%

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After the close on Monday, Australia stocks declined as losses in the Metals & Mining, Materials and Resources sectors led shares lower.

At the close in Australia, the S&P/ASX 200 declined 0.12%, 02:00AM ET.

The top performers of the session on the S&P/ASX 200 were Myer Holdings Ltd (AX:MYR), which increased 18.31% or 0.195 points to trade at 1.260 at the close. In the meantime,Evolution Mining Ltd (AX:EVN) added 5.37% or 0.110 points to end at 2.160 and M Pharma Fp (AX:MYX) increased 3.73% or 0.050 points to 1.390 in late trade.

The poorest performers of the session were Western Areas Ltd (AX:WSA), which declined 4.58% or 0.110 points to trade at 2.290 at the close. Galaxy Resources Ltd (AX:GXY) declined 3.00% or 0.015 points to end at 0.485 and Alumina Ltd (AX:AWC) declined 2.82% or 0.050 points to 1.725.

Declining stocks outnumbered progressing ones on the Australia Stock Exchange by 520 to 466 and 348 ended unaffected.

The S&P/ASX 200 VIX, which gauges the implied volatility of S&P/ASX 200 options, increased 6.53% to 12.648.

Delivery of gold futures in April increased 0.70% or 8.75 to $1257.25 a troy ounce.

Somewhere else in commodities trading, delivery of crude in May fell 0.98% or 0.47 to hit $47.50 a barrel, while the June Brent oil contract declined 0.82% or 0.42 to trade at $50.50 a barrel.

AUD/USD increased 0.13% to 0.7634, although AUD/JPY dropped 0.78% to 84.18.

The US Dollar Index Futures declined 0.52% at 99.07.

On Additional News

After the close on Monday, Japan stocks declined as losses in the Chemical, Petroleum & Plastic, Mining and Shipbuilding sectors led shares to decrease.

At the close in Tokyo, the Nikkei 225 lost 1.44% to hit a new 1-month low.

The poorest  performers of the session were Furukawa Electric Co., Ltd. (T:5801), which decline 4.05% or 165.0 points to trade at 3905.0 at the close. Nomura Holdings Inc (T:8604) dropped 3.55% or 25.6 points to end at 696.4 and DeNA Co Ltd (T:2432) declined 3.28% or 79.0 points to 2330.0.

Decreasing stocks outnumbered progressing ones on the Tokyo Stock Exchange by 2388 to 679 and 274 ended unmoved.

The top performers of the session on the Nikkei 225 were Daikin Industries, Ltd. (T:6367), which increased 1.23% or 135.0 points to trade at 11110.0 at the close. Temporarily, Tokyo Electron Ltd. (T:8035) added 0.60% or 70.0 points to end at 11650.0 and Tokuyama Corp. (T:4043) increased 0.38% or 2.0 points to 527.0 in late trade.

The Nikkei Volatility, which gauges  the implied volatility of Nikkei 225 options, declined 2.35% to 17.87.

Delivery of crude oil for May declined 0.83% or 0.40 to $47.57 a barrel.

Somewhere else in commodities trading, delivery of Brent oil in June dropped 0.65% or 0.33 to hit $50.59 a barrel, while the April Gold Futures contract increased 0.77% or 9.65 to trade at $1258.15 a troy ounce.

USD/JPY declined 1.09% to 110.16, while EUR/JPY drop 0.44% to 119.70.

The US Dollar Index Futures plunged 0.67% at 98.92.

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Australia Stocks Increases at Close of Trade; S&P/ASX 200 Increase 0.29%

After the close on Monday, Australia stocks increased as gains in the Metals & Mining, Materials and Resources sectors led shares higher.

Gold Moves Higher

After the close on Monday, Australia stocks increased as gains in the Metals & Mining, Materials and Resources sectors led shares higher.

At the close in Australia, the S&P/ASX 200 increased 0.29%.

The best players of the session on the S&P/ASX 200 were Isentia Group Ltd (AX:ISD), which increased 7.56% or 0.110 points to trade at 1.565 at the close. In the meantime, Aconex Ltd (AX:ACX) added 6.48% or 0.230 points to end at 3.780 and Australian Agricultural Company Ltd (AX:AAC) increased 3.60% or 0.050 points to 1.440 in late trade, 12:30AM ET.

The poorest performers of the session were Navitas Ltd (AX:NVT), which declined 15.02% or 0.745 points to trade at 4.215 at the close. Resolute Mining Ltd (AX:RSG) declined 4.95% or 0.070 points to end at 1.345 and Fairfax Media Ltd (AX:FXJ) declined  4.17% or 0.040 points to 0.920.

Declining stocks outnumbered progressing ones on the Australian Stock Exchange by 586 to 485 and 335 ended unaffected.

Shares in Navitas Ltd (AX:NVT) declined  to 52-week lows; down 15.02% or 0.745 to 4.215.

The S&P/ASX 200 VIX, which gauges the implied volatility of S&P/ASX 200 options, declined 3.27% to 12.101.

Delivery of gold futures for April increased 0.54% or 6.65 to $1233.15 a troy ounce. Somewhere else in commodities trading, delivery of  crude oil in April fell 0.43% or 0.23 to hit $53.10 a barrel, although the May Brent oil deal fell 0.36% or 0.20 to trade at $55.70 a barrel.

AUD/USD  declined  0.20% to 0.7578, while AUD/JPY drop 0.28% to 86.28.

The US Dollar Index Futures increased 0.12% at 101.47.

On Additional News

Asian shares were generally weaker, with greater China edging up on Monday after a missile test by North Korea that weighed on regional risk sentiment.

North Korea fired several missiles off its east coast, which flew approximately 1,000 km (620 miles), South Korea’s military stated, while Japan said “three missiles landed inside its exclusive economic zone and that it would not tolerate the hermit state’s provocative actions.”

Japan’s Nikkei 225 decline 0.46%, while the S&P/ASX 200 plunged 0.24% as Australia reported retail sales for January with a 0.4% increase as seen month-on-month, 12:03AM ET.

The Shanghai Composite surge 0.37% and Hong Kong’s Hang Seng index increased  0.37%

During the  weekend, Premier Li Keqiang sounded a careful note at the yearly meeting of parliament that started Sunday, and said that China would develop its economy by approximately 6.5%, compared to the progress target of 6.5 to 7% set the previous year.

Other notable goals from Li’s speech include China targets for a yearly consumer price index (CPI) of approximately 3%, and a yearly  budget deficit of 3% of gross domestic product, and 2017 M2 growth of approximately 12 percent.

The yearly National People’s Congress (NPC) will also kick off today and last until March 15.

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Dollar Increase with March Fed Rate Hike in View

On Thursday, the greenback soared a seven-week peak on increasing indications given by Fed Reserve Representatives that the U.S. central bank is extremely considering raising interest rates this month.

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On Thursday, the greenback soared a  seven-week peak on increasing indications given by Fed Reserve Representatives  that the U.S. central bank is extremely considering raising interest rates this month.

Later on Wednesday, Fed  Reserve Governor Lael Brainard stated a developing global economy and a solid U.S. recovery mean it will be “appropriate soon” for the Fed rate hike.

The dollar index, which gauges the dollar against a basket of six major currencies, was a little higher at 101.91. The index increased to 101.97 on Wednesday, its highest since Jan. 11.

On Tuesday, two influential Fed officials, William Dudley and John Williams, stimulated greenback bulls with remarks that suggested rate-setters are concerned about waiting too long in the face of the pending economic stimulus from Washington.

“The Fed is likely to raise interest rates this month unless the U.S. jobs data due next week is bad,” said Yukio Ishizuki, FX strategist at Daiwa Securities in Tokyo.

Futures traders are now expecting a 66% probability of a Fed hike in March, up from 35% on Wednesday, according to the CME Group’s FedWatch Tool.

U.S. President Donald Trump’s long-awaited speech on Tuesday failed to give specific information on his economic ideas, but outlined broad tax reductions  and a $1 trillion public-private initiative to rebuild degraded roads and bridges.

“Investors liked that Trump was behaving well during his speech, although it lacked specifics in policies,” said Daiwa’s Ishizuki.

The greenback  increased up 0.3 percent, against its Japanese counterpart  at 114.04 yen. The dollar reached a two-week peak  of 114.16 yen earlier in the day.

A widening of U.S.-Japan interest rate differentials supported the dollar, as U.S. Treasury yields jumped on an increased prospect for a March rate hike.

The U.S. two-year yield increased near a more than seven-year high of 1.308% touched on Wednesday. The benchmark 10-year Treasury yield was also close to a two-week peak,the last standing at 2.461 percent.

However, some analysts warned that the greenback could decline in spite of the widening interest rate differentials should stocks retreat.

Investors are closely observing speeches from Fed Chair Janet Yellen and Vice Chair Stanley Fischer on Friday for additional policy indications.

The U.S. non-farm payrolls next Friday is another critical factor to decide on the probability of a March rate hike.

Sterling and the Canadian dollar weakened compared to the greenback to their lowest levels since Jan. 20.

On Wednesday, Canada’s central bank held rates steady, striking a cautious tone on the “significant uncertainties” facing the economy.

The dollar increased near a six-week high against the loonie, last standing at 1.3356 Canadian dollars.

Sterling dropped to a six-week low of $1.2261 as unsatisfactory economic data on Wednesday added to political nerves that have started to influence on the currency again after last year’s Brexit vote.

The euro declined 0.2% at $1.0529. On Wednesday, The common currency plunged to a one-week low of $1.0514 against the greenback.

The Australian dollar slumped on weaker than expected trade statistics, plunging 0.3 percent to $0.7654.

Australia’s trade excess decreased unexpectedly in January, though the quarterly current account might still edge into the black for the first time since the mid-1970s.

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Gold Prices Declines as Trump Addresses Congress on Policy Plans

On Wednesday, gold plunged in Asia as Donald Trump presented a strong law-and-order speech to the U.S. Congress that included a restriction on illegal immigration and restated call for wall on the border with Mexico, while calling for a massive repair of the nation’s tax system and increased spending on infrastructure and defense.

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On Wednesday, gold plunged in Asia as Donald Trump presented a strong law-and-order speech to the U.S. Congress that included a restriction on illegal immigration and restated call for wall on the border with Mexico, while calling for a massive repair of the nation’s tax system and increased spending on infrastructure and defense.

The Trump list of things also included a call for lower drug prices and  undetermined new healthcare coverage plan.

Delivery of gold in May on the Comex division of the New York Mercantile Exchange fell 0.51% to $1,247.45 troy ounce.

Also on the Comex,  delivery of silver futures for May  declined 0.58% to $18.362 a troy ounce. Copper futures increased  0.29% to $2.723 a pound, 10:03PM ET.

Investors noted positive  manufacturing figures from China that established the stage for global growth hopes.

On Tuesday, gold Futures traded lower overnight, as the greenback  moved off session lows, ahead of President Trump’s speech to congress. In spite of a mixed batch of U.S. economic data, gold futures fight for direction in mid-afternoon trade, as President Trump’s address to congress on Tuesday at 9 PM EST remained front and center.

In the final three months of 2016 gross domestic product (GDP) increased at a 1.9% annual rate, the Commerce Department stated on Tuesday its second estimate for the period. Analysts expected a 2.1% yearly rate increase.

The Consumer Confidence Index, which gauges  consumers’ assessment of the latest conditions in the U.S., touched 114.8 in February, according to the statistics from The Conference Board. Economist anticipated the Consumer Confidence index to hit 111 in February.

The mixed bag of economic statistics came during renewed expectations of a March interest rate hike, after Dallas Fed President Robert Kaplan on Monday restated his outlook that a rate hike should happen sooner rather than later.

Fed fund futures priced in approximately a 40% probability of a rate hike in March, according to the reports.

Gold is sensitive to changes in U.S. interest rates, which lift the opportunity cost of holding non-yielding assets like bullion, while increasing the dollar in which it is priced.

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Dollar Increases in Asia in Busy Regional Data Flow

On Tuesday, the greenback increased in Asia in a busy regional data day that highlighted some weaker than expected statistics on trade in New Zealand and Australia and industrial production in Japan.

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On Tuesday, the greenback increased in Asia in a busy regional data day that highlighted some weaker than expected statistics on trade in New Zealand and Australia and industrial production in Japan.

The U.S. dollar index, which gauges the greenback’s strong point against a trade-weighted basket of six major currencies, increased 0.08% to 101.22, 08:12PM ET.

The trade balance in New Zealand for January came in at a deficit of NZ$3.470 billion year-on-year, wider than the NZ$3. 195 billion gap expected. NZD/USD traded at 0.7182, down 0.15% after the data.

In Japan, provisional industrial output fell 0.8% month-on-month in January, compared with a 0.3% surge  seen and retail sales increased a higher than expected 1.0%, with an 0.9% increase expected.

“USD/JPY declined 0.10% to 112.59 after the figures with the emphasis more on a speech by President Donald Trump later in the day to a joint-session of the U.S. Congress that could touch on trade policies as well as tax and spending plans,” according to the reports.

In Australia, private sector credit increased 0.2%, lower than 0.5% hike expected, while the current account for the 4th quarter came in at a deficit of A$3.9 billion, wider than the A$3.6 billion gap expected. AUD/USD plunged 0.01% to 0.7672.

Overnight, the U.S. dollar reversed prior losses against a slide of major currencies on Monday, as optimism surrounding a March interest rate hike increased.

The greenback  bounced off session lows, after Dallas Fed Reserve President Robert Kaplan speech in Oklahoma on Monday strengthened hopes of a march interest hike.

Mr. Kaplan restated his view that a rate hike should happen sooner rather than later in order to control rising inflation.

According to the report, 33% of traders anticipate the Fed to increase interest rates at its next meeting in March compared to only 26% of traders a day before.

The sharp reversal in the dollar comes ahead of an eagerly awaited speech by President Donald Trump to Congress on Tuesday.

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