Markets Push On | Calamatta Cuschieri

Optimism drives markets, IAG acquires stake in Norwegian Air & monthly OPEC crude report

U.S. stocks closed with solid gains on Thursday as investors looked past the latest headlines and tweets coming from the White House and turned their focus to earnings season, which kicks off on Friday. The Dow Jones Industrial Average rose 1.2%, or 293.60 points, to 24,483.05. The S&P 500 ended up 21.80 points, or 0.8%, to 2,663.99. The Nasdaq Composite Index was up 71.22 points, or 1%, to 7,140.25.

European stocks closed higher Thursday, as concerns over a potential military conflict in Syria eased with the Stoxx Europe 600 index adding 0.7% to close at 378.81, led by the technology sector. British software firm Micro Focus led the sector and was trading second on the Stoxx 600, pushing up in afternoon trade to close 7.6 percent higher.

IAG stake in Norwegian Air

IAG SA bought a stake in Norwegian Air Shuttle ASA and said it’s considering making a full offer for the discount competitor, signaling a new round of dealmaking in a rapidly consolidating European airline market. IAG will use the 4.61 percent stake to initiate discussions with Norwegian, it said in a statement. The ownership stake makes it harder for Norwegian to brush off the approach while acting as a deterrent to rival bidders.

Shares of Norwegian Air soared as much as a record 47 percent. A potential acquisition could value the company, which has a market value of more than $1 billion, at about $3 billion including debt. Other airlines in the region rose broadly in anticipation that a large discount rival would be eliminated. SAS AB, the Nordic region’s biggest mainline carrier, gained as much as 11 percent. EasyJet and Ryanair advanced 2.9 percent and 1.8 percent, respectively.

OPEC monthly report

The Organization of the Petroleum Exporting Countries said in its monthly report oil stocks in the developed world reversed a rise in January to fall by 17.4 million barrels in February to 2.854 billion barrels, around 43 million barrels above the latest five-year average. The global oil stocks surplus is close to evaporating, OPEC said, citing healthy energy demand and its own supply cuts while revising up its forecast for production from rivals who have benefited from higher oil prices.

U.S. shale oil output has been booming over the past year since OPEC reduced its own production in tandem with Russia to prop up global oil prices. However as oil production collapsed in OPEC member Venezuela and is still facing hiccups in countries such as Libya and Angola, the oil exporters’ group is still producing below its targets meaning the world needs to use stocks to meet rising demand.

This article was issued by Peter Petrov, Junior Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.