Investors should brace themselves for another week of trading in markets as the US government warned of the toughest week yet in its fight against the corona virus, while a deal between Saudi Arabia and Russia to reduce their oil production continues became more doubtful.
President Donald Trump said in a news conference on Saturday that the coming week will be "probably the toughest" for the United States with "many deaths unfortunately". US indices posted their third weekly decline in four last week. It lost 1.7%, while it fell 1.6%. It ended the week with 1.5%.
Another likely setback will come from the energy markets where the OPEC + meeting to decide on a cut in production was postponed after the media reported that both Riyadh and Moscow needed more time to negotiate.
President Trump raised the prospect of a new deal last week to end the massive oversupply in the oil markets due to a blockage of the world's largest economies. His tweet about a possible deal between the major oil producers saw a 50% recovery in reference oil prices.
In addition to these macro developments, we focus on the following three files because of the company-specific developments:
1. Altria Group
Tobacco giant Altria Group (NYSE: ) comes under pressure after the Federal Trade Commission sued the company to reverse its $ 12.8 billion deal to an interest in Juul Labs Inc. take, said the companies are competitors who should not do business together.
On Friday, the committee released a significant portion of its complaint, noting that Altria had left the e-cigarette market in late 2018 due to a secret deal with rival Juul. The FTC's complaint states that Altria and Juul were aggressive rivals until Altria decided to end competition by closing its own e-cigarette brands, MarkTen and Green Smoke, before acquiring its stake in Juul.
Altria, which produces Marlboro and operates Philip Morris (NYSE 🙂 USA has already written down its investment in Juul twice, bringing the value of its 35% stake down to $ 4.2 billion in January, as concerns over the health of e-cigarettes led to a crackdown. In the midst of this regulatory move, the Altria stock has lost 25% of its value this year, closing at $ 37.41 on Friday.
2. Delta Air
Warren Buffett & # 39; s Berkshire Hathaway (NYSE 🙂 said at the end of Friday this week that it had about 18% of its stake in Delta Air Lines (NYSE: NYSE 🙂 has sold amid the coronavirus pandemic that forced airlines to stop flight operations.
According to registration documents, Berkshire sold nearly 13 million Delta shares for approximately $ 314 million and approximately 2.3 million Southwest Airlines Company (NYSE 🙂 shares for approximately $ 74 million.
The sale took place on Wednesday and Thursday, according to the submitted documents. Berkshire previously owned about 11.1% of the Delta stock and 10.4% of the Southwest stock, according to Refinitiv data. No reasons were given for the sale.
DAL Weekly TTM
The Omaha, Nebraska-based conglomerate is one of the largest shareholders of the four largest US airlines, including Delta. Berkshire sales were announced after major U.S. airlines filed on Friday for a payroll application from the U.S. Treasury to keep workers employed.
The pandemic has punished the industry as passengers stay at home and carriers all over the world lower their schedules and ground planes. Delta predicted Friday that sales would drop 90% in the second quarter. Delta Air shares were down 11% after-closing trading on Friday at $ 22.48.
3. Levi Strauss
The garment maker, Levi Strauss & Co. (NYSE :), will release its Q1 2020 fiscal profit on Tuesday, April 7, after the market closes. Analysts expect an average of $ 0.35 per share with revenues of $ 1.46 billion.
The San Francisco-based apparel company is in the midst of global closings due to the coronavirus pandemic, as many malls and retailers are closed and consumers remain indoors, focusing on groceries and other essential groceries.
LEVI Weekly TTM
Levi Strauss has worked to strengthen his retail network and the sale of e-commerce. To stimulate growth, the denim manufacturer is also investing harder in international markets, including Europe, Asia and America.
Aside from declining demand, another threat to large international companies that need to convert foreign profits into US currency is the strong one of the past few weeks. Shares have fallen by 48% in the past month and closed on Friday at $ 9.51.
