Stocks on the move: Brenntag down 9%, Telecom Italia down 4%
Brenntag shares fell more than 9% in early trade after the German chemicals distributor confirmed that it had held preliminary takeover talks with U.S. rival Univar Solutions.
Telecom Italia shares were down 4.2% in early deals ahead of a potential decision on a takeover bid from Italian state lender CDP.
Oil prices slip as China’s Covid protests continue
Crude oil futures slipped early in Asia as high Covid cases, virus restrictions and unrest in China raise fears about demand from the world’s second-largest oil consumer.
West Texas Intermediate futures shed 0.35% to $76.01 per barrel, while Brent crude futures lost 0.26% to $83.41 per barrel.
Oil prices saw sharp falls last week as “mounting lockdowns in China raised concerns over demand,” ANZ Research’s Brian Martin and Daniel Hynes wrote in a Monday note.
“This remains a headwind for oil demand,” they said, adding that the impact of rising Covid cases was reflected in China’s mobility data as well.
— Abigail Ng
CNBC Pro: Asset manager picks three global retailers to short amid a fall in consumer spending
Shares in mass market retailers will fall as profit margins are squeezed, and consumers curtail spending next year, according to Plurimi Wealth’s chief investment officer.
Patrick Armstrong told CNBC’s Pro Talks that he was betting against a Japanese retailer, multinational clothing company, and a Canadian e-commerce platform by selling their shares short.
Armstrong believes consumers will hold back spending next year amid rising interest rates and household bills.
CNBC Pro subscribers can read more here.
— Ganesh Rao
There is a 30% probability that China reopens earlier than expected: Goldman Sachs
China is most likely to reopen around April next year after the National People’s Congress takes place, but there’s a chance that authorities reopen earlier due to difficulties in keeping Covid cases under control, according to Goldman Sachs.
Chief China Economist Hui Shan said there’s a 60% chance of the former scenario taking place.
“There is also a 30% probability of earlier reopening precisely because of the difficulty in keeping Covid under control, and the lack of medical preparation suggests it could be quite a messy process,” she said.
“Medical preparation is not ready yet, whereas the virus has evolved in such a way [that] it’s getting very costly to continue to implement that dynamic zero-Covid policy,” she said.
She said that policymakers need to weigh out the costs and benefits of the stringent Covid restrictions as protests take place across the country.
“This is not something they had experienced before [or] had a lot of experience in dealing with in prior cycles,” she said.
— Su-Lin Tan
CNBC Pro: Buy this Big Tech stock which is at an ‘attractive’ entry point now, says portfolio manager
One Big Tech stock is at an “attractive” price point to buy right now, according to Foord Asset Management’s Brian Arcese.
Arcese, a portfolio manager at the firm, expects growth in the “mid-teens” despite cyclical headwinds in its industry.
CNBC Pro subscribers can read more here.
— Weizhen Tan
European markets: Here are the opening calls
European markets are heading for a lower open on Monday as investors keep a close eye on unrest in China amid protests against Covid lockdowns.
The U.K.’s FTSE index is expected to open 37 points lower at 7,453, Germany’s DAX down 76 points at 14,470, France’s CAC down 35 points at 6,679 and Italy’s FTSE MIB down 181 points at 24,595, according to data from IG.
There are no major earnings or data releases.
— Holly Ellyatt
