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Tesla, PayPal lift S&P 500 and Nasdaq ahead of Big Tech earnings

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October 25, 2021

By Devik Jain and Shashank Nayar

(Reuters) – U.S. stock indexes edged higher in choppy trade on Monday, led by gains in Tesla and PayPal shares, while investors geared up for earnings reports from heavyweight technology companies this week that could provide direction to the markets.

Tesla Inc rose 4.5% to a record high after car rental firm Hertz placed an order for 100,000 Tesla cars, while Morgan Stanley boosted its price target on the electric-car maker’s stock.

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Its shares provided the biggest boost to the S&P 500 and the Nasdaq, followed by PayPal Inc, which added 4.9% after the payments company scrapped its plans to buy the digital pinboard site Pinterest Inc for as much as $45 billion. Shares of Pinterest plunged 13.6%.

Five of the 11 major S&P sectors advanced in early trading. Energy shares outperformed with a 1.9% gain.

Facebook Inc, which will kick off quarterly results for mega-cap technology giants after markets close on Monday, fell 0.3%. Investors fear its ad revenue could face the brunt of Apple’s iPhone privacy changes that have also hit Snap Inc’s third-quarter revenue.

“After Snap got an Apple caught in its throat, markets will have an itchy trigger finger over the sell button if the social network says the same,” said Jeffrey Halley, senior market analyst, Asia Pacific at OANDA.

Coupled with Facebook, shares of Microsoft, Apple, Alphabet and Amazon.com Inc which collectively account for over 22% of the weighting in the S&P 500 also slipped, capping gains on the S&P 500 and the Nasdaq.

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Strong earnings updates from some companies lifted the benchmark index to an intra-day record high on Friday, driving a 5.6% gain so far in October after a stumble in September.

Analysts expect S&P 500 earnings to grow 34.8% year-on-year for the third quarter, according to data from Refinitiv.

“We are seeing strong confidence with upward revisions to quarterly earnings estimates,” said Sam Stovall, chief investment strategist, CFRA Research.

“The market has regained its old highs and old highs are like rusty doors that require several attempts to swing it open, so it is going to take more sideways trading days before markets take off again.”

Investors are also assessing how companies are mitigating supply chain bottlenecks, labor shortages and inflationary pressures to sustain growth.

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Shares of Kimberley-Clark dropped 3.3% after the Huggies diapers maker cut its 2021 profit outlook due to higher input cost inflation.

At 10:09 a.m. ET, the Dow Jones Industrial Average was up 29.88 points, or 0.08%, at 35,706.90, the S&P 500 was up 5.33 points, or 0.12%, at 4,550.23, and the Nasdaq Composite was up 45.24 points, or 0.30%, at 15,135.44.

On the economic data front, readings on U.S. third-quarter GDP – the Federal Reserve’s favored inflation gauge, the core PCE price index and consumer confidence data will be released later this week.

Carnival Corp slipped 1.3% after Citigroup downgraded the cruise operator’s stock to “neutral” from “buy”.

Advancing issues outnumbered decliners by a 1.56-to-1 ratio on the NYSE and by a 1.40-to-1 ratio on the Nasdaq.

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The S&P index recorded 50 new 52-week highs and one new low, while the Nasdaq recorded 95 new highs and 45 new lows.

(Reporting by Devik Jain and Shashank Nayar in Bengaluru; Editing by Maju Samuel)

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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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