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Marketmind: Trillion-dollar Tesla

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October 26, 2021

LONDON (Reuters) – A look at the day ahead from Sujata Rao

Apple, Amazon, Microsoft, Alphabet… and Tesla. We now have a trillion-dollar EV firm whose 10% surge on Monday lifted Wall Street to new record highs — electric vehicles going mainstream is perhaps encouraging news ahead of the COP26 environment summit.

The news was less cheerful from Facebook which is contending with whistleblowers and falling popularity among the young. But a $50 billion buyback plan, unveiled after market close, may be enough to lift the shares on Tuesday, especially if fellow tech titans Google, Microsoft and Twitter also post upbeat figures.

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All in all, the global equity index is inching back towards the record highs hit early-September. U.S. stock futures pointing north for Tuesday and Japanese markets added 1.8%. In Europe, a surprise 9% profit boost at UBS — its highest in six years — could see the pan-European banking index rally further past April 2019 highs.

But the supply-chain snarl-ups, container traffic jams and chip shortages bedevilling companies worldwide show no signs of going away any time soon.

Just take carmaker Hyundai, which missed profit estimates and predicted that the chip shortages hampering output would take a long time to fix. And French car parts maker Faurecia saw Q3 sales drop 10% as semiconductor shortages forced its customers to cut production.

Then there is the prospect of central bank policy tightening, with the Bank of England looking set to join rate-hike club next month.

It all adds up to slower economic growth and earnings, Citi reckons. That could see buy-side analysts switching to net “downgrade” mode on stock recommendations for the first time since the pandemic first hit, it added.

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And don’t forget China, where another developer Modern Land missed paying a bond due on Monday. Shanghai and Hong Kong shares fell, despite gains for EV firms.

Key developments that should provide more direction to markets on Tuesday:

-Philadelphia Fed Nonmanufacturing Business Outlook Survey

-U.S. monthly home prices Aug/consumer confidence Oct/new home sales Sept

-U.S. 2-year note auction

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-Europe earnings: Norsk Hydro posts record Q3; Reckitt Benckiser ups full-year f’cast after upbeat Q3; Logitech sales rise on work-from-home boom

– -U.S. earnings: 3M, Corning, Eli Lilly, General Electric, Hasbro, Invesco, JetBlue, Lockheed Martin, S&P Global, United Parcel Service, Xerox, Google, Microsoft, Texas Instruments, Twitter, Visa

(For graphic on Tesla – https://fingfx.thomsonreuters.com/gfx/mkt/jnvwewzegvw/Pasted%20image%201635194081739.png)

(Reporting by Sujata Rao; editing by Karin Strohecker)

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Canada’s Shopify records Black Friday sales up 21%

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November 27, 2021

(Reuters) – Canadian e-commerce company Shopify Inc recorded worldwide sales of nearly $2.9 billion on Black Friday, an increase of about 21% in comparison to last year, the company said Saturday.

New York, London and Los Angeles were among the top-selling cities, the company said, while apparel and accessories was the top-selling product category.

Shopify also said it funded 23,000+ tonnes of carbon removal to counteract emissions from the delivery of every order placed on its platform on Black Friday.

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(Reporting by Aakriti Bhalla in Bengaluru; Editing by Nick Zieminski)

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Xiaomi to open car plant in Beijing with annual output of 300,000 vehicles – Beijing govt

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November 27, 2021

SHANGHAI (Reuters) – Chinese smartphone giant Xiaomi Corp will build a plant that can produce 300,000 vehicles annually in Beijing for its electric vehicle unit, authorities in the capital said on Saturday.

The plant will be constructed in two phases and Xiaomi will also built its auto unit’s headquarters, sales and research offices in the Beijing Economic and Technological Development Zone, the government-backed economic development agency Beijing E-Town said on its official WeChat account.

Beijing E-Town said it anticipated the plant reaching mass production in 2024, a goal announced by Xiaomi’s Chief Executive Lei Jun in October.

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In March, Xiaomi said it would commit to investing $10 billion in a new electric car division over 10 years. The company completed the business registration of its EV unit in late August.

The company has been opening thousands of stores to spur domestic sales growth for its smartphone business but eventually intends to use these shops as a channel for its plans to sell electric vehicles.

(Reporting by Brenda Goh; Editing by William Mallard)

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Eni sells Snam 49.9% stake in Algeria gas pipelines for 385 million euros

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November 27, 2021

MILAN (Reuters) -Italian energy group Eni has agreed to sell gas group Snam 49.9% of its stake in strategic pipelines carrying Algerian gas into Italy for 385 million euros ($436 million), the two companies said on Saturday.

The pipelines will be jointly controlled by the two companies, they said in a joint statement.

Italy imports more than 90% of its overall gas needs and Algerian gas currently accounts for around 30% of flows.

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“This transaction allows us to free up new resources to be used on our energy transition path,” Eni Chief Executive Claudio Descalzi said.

Eni is working on spinning off a series of oil and gas operations into new joint ventures to help reduce debt and fund its shift to low-carbon energy.

Snam, which owns a 20% stake in the TAP pipeline that carries Azeri gas into Italy, makes most of its money from managing Italy’s gas transport grid.

It has pledged to spend more on new green business lines such as hydrogen and, like other gas grid operators in Europe, is upgrading its gas network to be hydrogen ready.

“In the future, North Africa could also become a hub for producing solar energy and green hydrogen,” Snam CEO Marco Alvera said.

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The pipeline companies involved in the deal posted net income of around 90 million euros in 2020.

($1 = 0.8836 euros)

(Reporting by Stephen Jewkes, editing by Giselda Vagnoni)

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