Monday Briefing: Brent is Due for Correction

August 1, 2016

A new week is here, and brings with it many developments in the global financial markets. Oil has entered a bear market in India as crude just saw a 20% in its price. Unfortunately, the price drop may be offset by the weaker rupee. Discover this story and more on Sentifi.


1/ Gasoline: Brent correction cuts petrol bills in India

Brent crude is speculated to correct by 5 percent or more in India after its price has fallen by 20% over the course of June. That means the people of India will see a decline in petrol bills, albeit a small one. Unfortunately, for traders, the rupee is quite weaker at the moment, possessing the potential to offset the fall in crude price. And that makes put writers, or sellers of options, grapple with significant losses.

2/ Cyber Attack: Russia got hacked

A allegedly professional hacker had hacked and planted a cyber-spying virus into the websites of the Russian government bodies, as reported by the country’s intelligence service agency Federal Security Service. This attack came less than a week after Russia was accused of hacking into emails of Democratic nominee Hillary Clinton.

3/ McDonald’s: Jefferies Group boosts EPS estimates for the company

Strong Q2 earnings help improve the company’s Q3 forecast. (Justin Sullivan/Getty Images)

The analysts at Jefferies Group recently have boosted their Q3-2016 EPS for the fast-food chain from $1.46 per share to $1.47 per share. The decision was made based on the company’s better-than-expected Q2 earnings, which created a better outlook for the shares.

4/ Economic Development: Public debt in Africa sees alarming rise

The economic development in Africa appears to hit a roadblock based on revelation from the Economic Development in Africa Report 2016 that seven countries in the continent are high risk for debt distress. An overall rise in external debt, private debt, declining export receipts and domestic debt is also underlined by the report. This spells trouble to the economic development of the continent as its largest economies, Nigeria and South Africa, are the most susceptible to the risk of turning private debt into public debt.

5/ Blackberry: Introduces its second-ever Android phone

The struggling company has introduced its second-ever Android phone in an attempt to boost sales and improve profits. The initial reception of the phone was quite positive, marking this an opportunity for the company to deliver a good product and capitalize on the hype.

6/ Snapchat: Faces lawsuit over mapping faces

Snapchat got in trouble with the law again, this time about storing facial data without users’ consent.

Two residents in Illinois sued the company for capturing and storing facing recognition data without users’ consent. But Snapchat has denied the claim, saying it would not do such thing as storing biometric information of its community. A California federal court is currently reviewing the case.

7/ EU Banks: Have lots of work to do based on stress test’s results

The latest European Banking Authority’s stress test found that despite being more resilient, the EU banking sector is still being ravaged by poorly performing loans. The biggest banks such as Deutsche Bank, Commerzbank, UniCredit, etc., are among the worst performers in the test.

8/ Fraport: Sells stake to Qatar

The German transport company is reported to sell a stake of the St. Petersburg airport to the Qatar Investment Authority for approximately $34 million to $45 million. The airport, currently plagued by low travelers number, has proven to be an ailing asset. The deal will help Fraport offset weakening revenue and confirm its 2016 earnings forecast.

9/ Fonterra: Lifts forecast EPS for FY2017

Performance improvements across business of Fonterra has boosted its confidence to raise its forecast EPS for FY2017, with its value-add strategy being one of the main factors. The company is focusing on delivering as much cash as possible to farmers and maintaining a strong balance sheet.

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