McDonald’s shares plunge after deadly e.coli outbreak
Thanks for joining me. McDonald’s shares plunged in after-hours trading after its burgers were linked to a fatal outbreak of e.coli.
One person died and at least 49 people across 10 US states were taken ill, with everyone interviewed by the CDC sayig they had eaten a McDonald’s shortly beforehand.
5 things to start your day
1) Reeves plots ‘Amazon tax’ to prop up struggling high street | Chancellor looks to level the playing field between in-store and online retailers
2) Uber rival vows to ‘stop insanity of people working from places like Bali’ | Bolt chief cracks down on remote working after claiming staff are ‘disconnected’
3) How Britain’s benefits system ‘throws you on the scrap heap’ | Financial disincentives and feeling of ‘uselessness’ stop long-term sick working
4) Ambrose Evans-Pritchard: China and the global south will not save ‘big oil’ | Opec tells us that demand will continue to grow for decades – as if technology stands still
5) Jeremy Warner: Reeves’s decision to tax, spend and borrow more is entirely political | Reeves is gambling that her Budget will see tangible improvements to public services
What happened overnight
Asian shares struggled for direction in early trade on Wednesday, reflecting subdued risk appetite as traders mulled the prospect of less aggressive Federal Reserve interest rate cuts.
Stocks moved between losses and gains in Japan and South Korea, with those in Australia modestly higher. Futures pointed to gains in Hong Kong. US contracts were flat after the S&P 500 closed little changed. Treasury 10-year yields hovered near 4.2pc after topping that level for the first time since July.
The lacklustre performance of equities comes as investors have pared back bets on rapid policy easing as the US economy remains robust and concerns rise about wider fiscal deficits after the presidential election. Since the end of last week, traders have trimmed the extent of expected Fed cuts through September 2025 by more than 10 basis points.
The stamina of China’s recent stock rally continues to draw attention, after a top government-linked think tank called on authorities to issue 2 trillion yuan ($281 billion) of special government bonds to help create a market stabilisation fund.
In currency markets, the dollar was steady in Asia after the euro hit the lowest since early August amid bets the European Central Bank will keep lowering rates.
Meanwhile, Japan’s 40-year government bond yield climbed to its highest level in 16 years amid growing speculation that the nation’s central bank will push ahead with interest rate increases in coming months.
Also making headlines in Tokyo, Metro Co.’s shares rose 36pc in their debut. The company raised 348.6 billion yen ($2.3 billion) in the country’s largest initial public offering since mobile carrier SoftBank Corp. listed in 2018.
On Wall Street yesterday, the Dow Jones Industrial Average was roughly flat at 42,924.89, the S&P 500 fell 0.1pc to 5,851.20 and the Nasdaq Composite rose 0.2pc to 18,573.13.
In the bond market, US Treasury yields have risen since the start of the week amid rose amid market uncertainty ahead of the US election as well as the outlook on interest rate cuts. The yield of 10-year US notes rose to 4.214pc yesterday from 4.212pc late on Monday and 4.096pc late on Friday.
