Before the Bell: Red Prices at Colruyt

The government shutdown distorted the U.S. jobs data. Will Amazon invest in OpenAI? And is this a good moment to fill your heating oil tank?

The Euro Stoxx 50 fell 0.6% yesterday. Belgium’s blue-chip index performed better and closed 0.1% higher. Logistics real estate stood out, with WDP (+2%) and Montea (+1.7%) leading the gains. Biscuit maker Lotus Bakeries (+1.7%) also finished in the green. On the other side of the Atlantic, the S&P 500 closed lower, while the technology-heavy Nasdaq edged up 0.2%. The U.S. jobs report failed to provide much clarity. The labour market recovered better than expected in November, with 64,000 new jobs added. However, the unemployment rate was distorted by the government shutdown and therefore rose to 4.6%, its highest level since 2021. Oil prices plunged nearly 3% yesterday to levels not seen since 2021. Excess supply and the prospect of a possible ceasefire between Ukraine and Russia pushed crude oil down to 55 dollar per barrel. On 15 January, oil was still trading at 80 dollar. Oil companies such as Phillips 66 (-6.8%), Halliburton (-4.3%) and Marathon Petroleum (-4.7%) were hit hard. Mosaic (-5.6%) also lost ground. The U.S. fertiliser producer is halting phosphate production at its Brazilian facilities after sulphur prices rose too sharply.

This morning in Asia, Hong Kong’s Hang Seng Index is up 0.6%, while Tokyo’s Topix is down 0.1%. In the United States, results are due from General Mills and Micron. On the macroeconomic front, Germany publishes its Ifo business confidence survey, while the United Kingdom releases inflation figures.

Is Amazon Investing in OpenAI?

Is e-commerce and cloud giant Amazon the next investor in OpenAI? The rumour mill is running at full speed, with speculation that the companies are negotiating an investment of more than 10 billion dollar. Such a deal would push OpenAI’s valuation above 500 billion dollar. OpenAI is expected to make use of Amazon’s Trainium AI chips and rely even more heavily on the company’s cloud infrastructure. The parent company of the popular chatbot ChatGPT has already entered into similar commercial partnerships with Nvidia, AMD, Oracle and Broadcom, with a combined estimated value of more than 1,500 billion dollar. At the same time, OpenAI is reportedly seeking access to Amazon’s e-commerce platform. The company already sells services to Shopify and Instacart and is looking to tap into new revenue streams in this way.

Colruyt Goes for the Lowest Price—Again

Yesterday, Colruyt did not tell shareholders what they were hoping to hear. A short and admittedly unscientific survey we conducted among our members about a year ago showed that the supermarket chain is popular with shoppers. But that does not automatically make the stock a good investment. After the closing bell, the company had to admit that business conditions have deteriorated. Revenue in the first half of the financial year, which at Colruyt runs until the end of September, rose by 4.5% to 5.3 billion euro. Operating profit, however, fell by 15.8% to 213 million euro. Net profit came in at 150 million euro, down 22.7% compared with the first half of the previous financial year. Market share also declined, from 29.2% to 28.8%. Management attributed the disappointing results to fierce competition and to the successful Sunday openings of rivals such as Delhaize. From next month, Colruyt will allow Sunday shopping at Okay, one of its formats. The large Colruyt stores, however, will remain closed on Sundays for the time being, while competitor Carrefour plans to open all its stores on the seventh day. For Colruyt’s share price, today is therefore likely to be a red-price festival on the stock market.

Did you know…

the richest person in the world is estimated to have a net worth of 638 billion dollar? Elon Musk’s fortune has surged following the latest valuation of SpaceX. The rocket company is now valued at 1,500 billion dollar.

This article was translated from Dutch and was originally published on Spaarvarkens.be.