Bulls drive Dow Jones to the 24000 mark

Today’s Overview:

• Dax crashes
• Dow Jones breaks the 24000 mark
• CFIUS clears Bayer’s planned takeover of Monsanto
• Tesla opens biggest Lithium battery factory
• Juniper goes crashing after Nokia denies take-over

After a long week with no real changes the German DAX seems to be heading down in the first day of December. After opening at 13044, the German Index is down at the12854 point mark, losing 130 bp. The DAX is not the only Index suffering in the first day of December. The euro zone is sliding down Overall on the last day of the week as euro zone factories posted their busiest month in over 17 years in November. At mid-day only 3 stocks are above the 0% line, the biggest loser being Infineon carrying a loss of 228bp. Europe’s financial stocks wilted after a delayed vote on tax reform in the U.S. deflated a rally in the sector, driving regional benchmarks to start December with a dip. Euro zone stocks fell 0.6 percent while Britain’s FTSE, which has suffered from a strong sterling this week, slid 0.1 percent.  Financials were the biggest weight after the U.S. Senate delayed a vote on a tax reform bill that investors anticipate will be beneficial for banks.  Lloyds, Barclays, and BNP Paribas led the index down.  Oil and gas stocks stayed buoyant, with Shell, Total and BP leading sector gains as OPEC’s extension of supply cuts continued to boost crude prices. Healthcare stocks outperformed thanks to a Morgan Stanley upgrade boosting UCB by 3.3 percent while Novo Nordisk, flagged as one of the strategists’ favourites in the pharma space, gained 2.8 percent.  British pharma company Indivior also shot up 11.7 percent after its opioid addiction drug got approved by the U.S. Food and Drug Administration.

In the U.S. the stock market delivered a strong performance yesterday, with traders seeming to be more confident that the Trump Administration’s tax plan will be approved. At the close of trading, the Dow Jones Industrial Average was ahead 332 points; the broader S&P 500 Index was up 21 points; and the NASDAQ was higher by 50 points. Market breadth was supportive, with winners nicely ahead of losers on the NYSE. Most equity sectors participated in today’s advance. The energy and industrial issues showed leadership, while the telecom names and utility stocks underperformed. Technically, the stock market continues to move strongly higher, with the Dow Jones Industrial Average now past the 24,000 mark. While equity valuations are elevated, traders seem content with the nation’s economic progress.

On other big news Germany’s Bayer said that the Committee on Foreign Investment in the United States (CFIUS) had no national security concerns about the drugmaker’s planned takeover of U.S. seeds group Monsanto, giving its go-ahead. Bayer and Monsanto will continue to cooperate with other authorities to complete the transaction in early 2018, Bayer said in a statement on Friday.

Tesla Inc switched on the world’s biggest lithium ion battery on Friday in time to feed Australia’s shaky power grid for the first day of summer, meeting a promise by Elon Musk to build it in 100 days or give it free. “South Australia is now leading the world in dispatchable renewable energy,” state Premier Jay Weatherill said at the official launch at the Hornsdale wind farm, owned by private French firm Neoen.  Tesla won a bid in July to build the 129-megawatt hour battery for South Australia, which expanded in wind power far quicker than the rest of the country, but has suffered a string of blackouts over the past 18 months. In a politically charged debate, opponents of the state’s renewables push have argued that the battery is a “Hollywood solution” in a country that still relies on fossil fuels, mainly coal, for two-thirds of its electricity.  Supporters, however, say it will help stabilize the grid in a state that now gets more than 40 percent of its electricity from wind energy, but needs help when the wind dies down.

Shares of Juniper Networks Inc fell 8 percent in pre-market trade on Thursday after Finland’s Nokia denied reports that it was in talks to buy the U.S. network gear maker.  CNBC on Wednesday reported, citing sources, that Nokia was in talks to buy Juniper at an offer that would value the company at around $16 billion, higher than Juniper’s $11.26 billion market capitalization as of Wednesday’s close. That valuation would imply a price of about $42 per share, a level last seen by Juniper shareholders six years ago, Morningstar analyst Ilya Kundozerov wrote in a client note.  Within hours of the CNBC report, however, Nokia, which does not typically comment on market rumors, said it was not preparing an offer for Juniper. Bernstein analyst Pierre Ferragu said Nokia acquiring Juniper seemed a stretch citing an operational alliance limited to $300 million to $400 million in costs, near impossible product integration in routing and a risk of negative revenue combination.