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AOF Wall Street Fence Analysis – Coronavirus Comes to the Front of the Stage

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(AOF) – Wall Street went down Thursday after hitting new records on Wednesday. Fear of the impact of the coronavirus on the global economy returns to the fore as the epidemic spreads faster than expected outside China. In this regard, Goldman Sachs believed that investors underestimated the potential negative effects of the virus on stocks. In this context, the stronger than expected jump of the Philly Fed has been relegated to the background. The Dow Jones fell 0.44% to 29,219.98 points. The Nasdaq lost 0.67% to 9,750.97 points.

Morgan Stanley lost 4.55% and went deep into the S&P 500 after announcing the buyout of brokerage firm E-Trade for $ 13 billion in stocks. This is the largest transaction in the banking sector in the United States since the financial crisis in 2008. The target is valued at $ 58.74 per share, which represents a premium of 30.7% compared to the closing. Wednesday evening. Each shareholder of E-Trade will receive 1.0432 Morgan Stanley shares per share held.

Economic figures of the day

The Philadelphia Fed manufacturing index jumped 20 points to 36.7 points, reaching its highest since February 2017. It was expected to 12, according to the Reuters consensus.

210,000 jobless claims were registered in the United States during the week of February 15, in line with expectations. The figure for the previous week has been revised from 205,000 to 206,000.

The values ​​to follow today

BUDGET NOTICE

Avis Budget lifted the veil on Wednesday evening on its results for the fourth quarter of 2019. Thus, the American car rental company published a net profit of $ 142 million over the period, or $ 1.90 per share, to compare with a profit net of $ 13 million, or 16 cents per share, a year earlier. Excluding exceptional items, adjusted earnings per share came to 73 cents, exceeding the expectations of the FactSet consensus (50 cents).

INTELSAT

Intelsat reported a net loss of 81 cents per share in the fourth quarter of 2019, while the FactSet consensus expected a loss of 94 cents per share. Revenues over the same period were $ 517 million, higher than analysts' forecasts of $ 500.9 million. For 2020 the company anticipates revenues of 1.93 to 1.98 billion dollars, the FactSet consensus for its part provides 1.98 billion.

L BRANDS

L Brands has confirmed the sale of 55% of Victoria's Secret, including the Pink and Victoria's Secret Beauty brands, to the private equity fund Sycamore Partners for approximately $ 525 million. L Brands remains a minority with 45%. The transaction values ​​the lingerie brand at $ 1.1 billion. L Brands will use this sale to repay its debt. L Brands CEO Leslie Wexner also announced his upcoming departure. The businessman who is involved in the Jeffrey Epstein affair will become “president emeritus”.

MORGAN STANLEY / E-TRADE

Morgan Stanley announced the purchase of the brokerage firm E-Trade for $ 13 billion in shares. This is the largest transaction in the financial sector in the United States since the financial crisis. The target is valued at 58.74 dollars, which represents a premium of 30.7% compared to the closing on Wednesday evening. Each shareholder of E-Trade will receive 1.0432 Morgan Stanley shares per share held.

THOMSON REUTERS

According to Reuters, Thomson Reuters is about to appoint Steve Hasker, former president of Nielsen Holdings, as the new managing director. He would succeed Jim Smith, who has been in place since January 2012 with the Canada-British agency.

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