 
The global stock markets went up very much as the expectations increased for a quick reaching of a US-China trade agreement by Donald Trump and Xi Jinping. The Asian stock markets rose very much—Japan’s Nikkei increased approximately 2.5%, South Korea’s Kospi went up 2.6%, and the mainland markets of China registered considerable gains as well. The futures in Europe were more or less up and the investors’ risk appetite was higher than before. The rise in the market was taking place at the same time as the prediction of a reduction in the Federal Reserve’s interest rate, and the hope that the Chinese government would lift the restrictions on rare earths exports. To sum up, the trade negotiation has brought back the risk appetite which is now supporting the overall market recovery.
2. Shockwaves from Petrofac’s collapse
The day, which ended with a market rally, also showed the fragility of large companies in a very harsh way. Petrofac, a contractor providing energy services to the oil and gas industry, submitted an application for administration after losing a lucrative contract for the Dutch offshore wind park and incurring more debts. Over 2000 jobs in Scotland are at risk. The failure of the company demonstrates that even the biggest service providers can fall if they lose an important contract and become financially overstrained, especially in fast-changing industries like offshore wind, where the electricity produced from wind turbines is very soon going to be the mainstream source. Moreover, political risk is very close — the UK government will now be under more pressure as it moves to stop relying on North Sea oil and gas.
3. M&A and regulatory tension – food-industry ripple
The examination of the merger is another important aspect of the story. The external regulator to competition in the UK, the Competition and Markets Authority (CMA), stated that it might start a complete investigation into the ÂŁ4 billion transaction between Bakkavor and Greencore since there are worries about the “substantial lessening of competition” in the supply of chilled supermarket sauces. This indicates that regulators are still very cautious in areas where mergers and acquisition might lead to the market being dominated by one player; in other words, smaller competitors might not survive. In this situation, both investors and companies can see a very interesting picture: the good news from the economy accompanies the bad news from individual companies and the regulators’ caution. click here for the source
