Investing.com -- China slashes a levy on stock trading in a bid to reinvigorate capital markets and boost investor confidence. Shares in the country rise following the announcement, although ailing property group Evergrande's shares slide sharply after they start trading for the first time since March 2022. Meanwhile, 3M's stock climbs in premarket trading on reports that the industrial conglomerate has reached a settlement over personal injury claims related to earplugs it has sold to the U.S. military.
1. Chinese shares jump following trading levy cut
Shares in China rose on Monday after regulators slashed the country's 0.1% stamp duty on stock trading in half, as Beijing attempts to restore investor confidence and reignite its flagging capital markets.
China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes both surged about 2.4% at one point, while Hong Kong’s Hang Seng added 1.8%. The three were the best performers in Asia, recovering from their weakest levels this year, although analysts warned that the rally may be short-lived as the impact from the cuts wanes.
Property stocks were among the top performers. The sole exception was China Evergrande Group (HK:3333), which resumed trading in Hong Kong for the first time in almost a year and a half on Monday. Shares in the embattled developer at the center of China's real estate crisis plummeted by about 80%, shedding as much as $2 billion in value.
2. Futures point higher
U.S. stock futures edged higher on Monday, with investors digesting comments from Federal Reserve Chair Jerome Powell on the potential path ahead for the U.S. central bank's monetary policy.
At 05:16 ET (09:16 GMT), the Dow futures contract added 68 points or 0.20%, S&P 500 futures inched up by 6 points or 0.14%, and Nasdaq 100 futures increased by 33 points or 0.22%. The main indices all closed in the green to end the prior trading week.
In a highly anticipated speech at an annual economic symposium in Jackson Hole, Wyoming on Friday, Powell argued to keep interest rates steady for now. But he noted that "further tightening" could be warranted if the economy does not slow enough to help cool inflation. The statements highlighted how carefully Powell is trying to adjust the levers of monetary policy to corral price gains without causing a meltdown in the wider economy.
There is an 80% chance that the Fed will maintain borrowing costs at a range of 5.25% to 5.50% at its next meeting in September, according to Investing.com's Fed Rate Monitor Tool. Meanwhile, the probability of a quarter-point hike at its November gathering stands at just under 50%.
3. Oil ticks up amid China economic support measures
Oil prices moved up on Monday, with traders attempting to gauge the effect of China's trading stamp duty decrease on the world's largest crude importer.
The move was seen as the latest in a series of incremental steps taken by Beijing to help reinvigorate the country's sputtering post-pandemic recovery. However, doubts remain over whether China's government is still doing enough to provide badly needed support to possibly one of the major drivers of oil demand this year.
Investors will have an opportunity to examine the state of the economy later this week when China's crucial manufacturing purchasing managers' index for August is released. Economists expect the reading to remain in contraction territory.
At 05:17 ET, Brent crude rose by 0.1% to $84.06 a barrel, while U.S. West Texas Intermediate crude gained 0.3% to $80.09 per barrel. Both slid to their second-straight weekly losses on Friday after Powell noted that more rate increases may be needed to help quell inflation in the U.S., exacerbating worries over demand in the top oil consumer.
4. 3M nearing $5.5B earplugs settlement - reports
3M Co. (NYSE:MMM) is reportedly nearing an agreement to pay $5.5B to resolve hundreds of thousands of claims brought against the company alleging that its earplugs sold to the U.S. military were defective.
According to multiple media reports, sources close to the matter say that the negotiations are ongoing and a final amount has yet to be finalized. The potential settlement was first reported by Bloomberg.
Shares in 3M popped in premarket U.S. trading.
More than 300,000 current and former service members have filed claims blaming Minnesota-based 3M and one of its subsidiaries for knowingly making earplugs that failed to protect them from hearing loss. 3M has contested the allegations, saying the earplugs work correctly when users are given proper training.
The $5.5B settlement amount would be far less than the $10B to $15B figure estimated by some analysts. However, it could still add to 3M's litigation costs, which are likely to mount further following a tentative multi-billion dollar settlement earlier this year to lawsuits over so-called "forever chemicals" in municipal water supplies.
5. Apple betting on iPad Pro overhaul - Bloomberg
Apple (NASDAQ:AAPL) is reportedly revamping its iPad Pro to help lift customer flagging sales of the tech giant's high-end tablet, according to Bloomberg News.
The next iPad Pro models will feature new iterations of Apple's M3 silicon chips, which are designed to be faster and more efficient than their predecessors, Bloomberg said. OLED displays -- a long-time staple of Apple's iPhone handset -- will also be used in the fresh iPad versions, which will also come in 11-inch and 13-inch sizes.
Meanwhile, Bloomberg reported that Apple's Magic Keyboard accessory will also be overhauled to make the user's experience with the tablet more like that of a laptop.
The new iPad models will not feature in Apple's annual launch event next month, Bloomberg noted, and will likely not be available for purchase until spring or early summer of 2024.
