Research Market strategy
By Swissquote Analysts
Published on 07.06.2022
Morning news

Elon Musk Threatens to End Twitter Deal Over Lack of Information

Topic of the day

Elon Musk threatened to terminate his deal to buy Twitter Inc. in a letter accusing the company of not complying with his request for data on the number of spam and fake accounts on the social-media platform. Mr. Musk said Twitter has refused to provide the data necessary for Mr. Musk to facilitate his own evaluation of the number of spam and fake accounts. In April, Twitter accepted Mr. Musk’s $44 billion bid to take over the company and go private. As part of the deal, Mr. Musk waived detailed due diligence that buyers typically perform on targets. In a letter to Twitter Chief Legal Officer Vijaya Gadde, Mr. Musk’s lawyer Mike Ringler said Mr. Musk is entitled to the requested data, in part so that he can facilitate the financing of the deal. Mr. Musk has lined up a group of 19 investors to back his deal. He has also said in filings that he is holding talks with other current Twitter shareholders, including co-founder Jack Dorsey, to roll their shares over into the private company.

Swiss stocks

The Swiss stock market ended trading at the end of the week with slight discounts. A strong U.S. labour market report for May confirmed the Federal Reserve's plans to raise interest rates. The Fed could continue to step on the accelerator in tightening monetary policy, said Thomas Altmann of QC Partners. The SMI lost 0.2 per cent to 11,529 points. Among the 20 SMI stocks, there were 11 losers and 7 gainers, and 2 stocks closed unchanged. 20.86 (previously: 22.51) million shares were traded. There were no clear preferences among investors. The share of luxury goods manufacturer Richemont led the SMI with a gain of 1.0 per cent, followed by Swisscom (+0.6 per cent). The day's losers were Lonza with discounts of 1.5 per cent. Alcon (-1.1%) and Logitech (-1.0%) were also among the laggards. Among the banking stocks, UBS closed unchanged, while Credit Suisse lagged well behind with a drop of 0.8 per cent. Index heavyweight Nestle closed 0.1 per cent firmer. Among the pharmaceutical giants, Novartis advanced 0.3 per cent, while Roche lost 0.8 per cent.

International markets


European stock indices closed higher on Monday, buoyed by announcements that Beijing is easing health restrictions. The Stoxx Europe 600 index rose 0.9% to 444.1 points. In Paris, the CAC 40 and the SBF each gained 1%. In Frankfurt, the DAX 40 gained 1.3%, while in London, the FTSE 100 gained 1%. British Prime Minister Boris Johnson is set to face a vote of no confidence Monday as rebel lawmakers from his ruling Conservative Party worry over widespread anger stemming from a series of parties held in Downing Street during the country’s Covid-19 lockdowns. Conservative lawmakers will gather in Parliament to vote on whether to dismiss Mr. Johnson. If a majority of the party’s 359 lawmakers decide the party needs new leadership, a contest to find a replacement prime minister will begin. Activist hedge-fund manager Elliott Management Corp. sued the London Metal Exchange for more than $456 million, after the exchange earlier this year suspended nickel trading and canceled some trades following wild swings in the metal’s price. The lawsuit is a fresh headache for the LME, whose actions had already drawn criticism from some market participants and prompted a review by British financial regulators. Elliott is challenging the exchange’s decision to cancel trades that it says it made early on March 8, according to Hong Kong Exchanges & Clearing Ltd., which owns LME.

United States

U.S. stocks finished modestly higher Monday as investors sifted through data and comments about the jobs market and inflation. The S&P 500 climbed 12.89 points, or 0.3%, to 4121.43, while the technology-focused Nasdaq Composite Index advanced 48.64 points, or 0.4%, to 12061.37. The Dow Jones Industrial Average added 16.08 points, or less than 0.1%, to 32915.78. All three indexes were higher in the morning, with the Nasdaq up nearly 2%. Investors are still trying to balance the positive signs from Friday's jobs report against more cautious recent economic commentary from executives such as Tesla's Elon Musk and JPMorgan's Jamie Dimon, said AvaTrade chief market analyst Naeem Aslam. shares rose $2.44, or 2%, to $124.79. Monday marks the first day of trading since the company executed a 20-for-1 stock split. Before the split, Amazon shares were at $2,447. Shares of Spirit Airlines rose $1.46, or 7%, to $22.20 after JetBlue Airways sweetened its offer to buy the company. JetBlue in May launched a hostile takeover of Spirit, which had already agreed to a merger with Frontier Airlines. Spirit's shareholders are set to vote on the Frontier merger proposal on Friday. Shares of JetBlue rose 22 cents, or 2.1%, to $10.69, while Frontier Group shares added 44 cents, or 4.5%, to $10.25. Shares of Keurig Dr Pepper climbed $1.77, or 5.1%, to $36.70, while VICI Properties advanced $1.06, or 3.4%, to $32.45 and ON Semiconductor increased $3.07, or 4.9%, to $66.01. S&P Dow Jones Indices said the three companies will join the benchmark S&P 500 index this month.


The East Asian stock markets showed a mixed trend on Tuesday. The Sydney stock exchange in particular recorded losses, where caution continued to dominate in the run-up to the Australian central bank's interest rate decision during the course of trading. The Reserve Bank of Australia (RBA) is expected to raise the key interest rate in view of rising inflation, but economists' forecasts differ as to the likely extent of the increase.


In the bond market, the yield on 10-year U.S. Treasury’s jumped to 3.037% from 2.940% Friday, as investors sold government bonds. Yields and bond prices move inversely. Bond yields have been on the rise in recent weeks but remain below their recent high of 3.124% set in early May.


Credit Suisse lowers Remy Cointreau target to EUR 190 (200) - Underperform
UBS raises OMV target to EUR 59 (58) - Buy
HSBC lowers EDF to Reduce (Hold) - Target EUR 7.40 (9.56)

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