Flow Traders Investment Competition: The Final Sprint

It has been a busy week for global markets as investors tuned into important political developments in the U.S. and Europe. Stateside, the major S&P 500 and Dow Jones indexes finished the week down -0.73% and -0.78%, respectively, amid a week dominated by high-profile acquisitions and Trump’s policy on Chinese foreign investment. European markets also finished the week lower, with the Eurostoxx 50 trading -0.88% lower and the Dutch AEX index down -0.69% following the EU summit. Overall, the MSCI World Index dropped by -0.27% as investors processed an eventful week.

In the U.S., Amazon announced on Thursday that it would acquire online pharmacy PillPack for $ 1 billion. This marks the American e-commerce titan’s first move into healthcare, one highly anticipated by investors but feared by established pharmacies whose stock prices were sent tumbling when the news broke out. In other acquisition-related news, Walt Disney won approval from U.S. antitrust authorities to acquire 21st Century Fox’s movie studio and cable channels for a reported $ 71 billion. Walt Disney outbid Comcast’s offer of $65 billion in what is one of the largest deals in the history of the entertainment industry. While acquisitions took up much of the headlines in the U.S., this did not distract investors from keeping an eye on Trump. The administration abandoned plans to prevent Chinese firms from acquiring U.S. technology altogether, but passed bills to make the investigation of foreign investment from China more rigorous. This includes broadening the scope of Chinese acquisitions investigated by the Committee on Foreign Investment in the U.S. to include investments in startups and real-estate transactions. Additionally, controls of U.S. exports of sensitive technologies, particularly those with military applications, will also be toughened as part of the measure.

In Europe, meanwhile, all eyes were pointed to the EU Summit where migration was the main matter at hand. In recent years, the migration crisis has driven the rise of many populist right-wing political parties who promise to adopt a tougher stance. This is especially the case in Italy where a newly formed coalition government has been established based on anti-EU sentiment and frustration with the country’s large migrant problem. Two agreements were made during the summit; that economic migrants are to be distinguished from asylum seekers and rejected entry into the EU, and that migrants rescued at sea will be sent to processing centres first to ensure more equal distribution to countries.

It has been an exciting week for our Investment Groups as they continue to battle each other until the very end of the competition. Hermanszoon Capital rose six places this week thanks to their investment in the American construction engineering company Argan, which rose over 10%. Batavia Investments, meanwhile, also had a good week with their rather unusual position in Portuguese football club Sporting that almost rose by 10%. Ultimately, it has not been easy with only four groups generating a positive return for the week, but it is not over just yet. The top three will be announced at the end-of-year BBQ on the 12th of July, so make sure to be there because it’s going to be closer than ever!

Written by Jasper Thouin