Good Evening. Here is everything you need to know about today’s recap on the in’s and out’s of the major market and economic events.
Investors continued to evaluate company earnings against the approaching monetary tightening that has dampened enthusiasm for stocks in recent weeks, pushing Wall Street’s key benchmarks higher on Tuesday.
The Dow Jones Industrial Average rose 1.06%, to conclude the session in positive territory, while the S&P 500 rose 0.84%. Despite rising bond yields, the Nasdaq Composite surged by 1.28%, boosted by increases in Big Tech. The yield on the 10-year US Treasury note reached 1.95%.
RAW MATERIALS
According to Bloomberg data, aluminum prices have risen to their highest level since 2008, approaching a new peak.
Due to supply-chain issues, raw materials such as aluminum and copper for consumer goods such as refrigerators, vehicles, and plumbing systems have increased in price. According to Bloomberg, the cost of transporting aluminum now accounts for 20% of the metal’s overall price, while the benchmark price for shipping copper in the United States is at its highest level since 2003.
As of closing, aluminum contracts for April 2022 delivery were up 3.00% to $3,266.25 per ton.
HORIZONTAL MERGER
Frontier Airlines and Spirit Airlines announced plans to merge on Monday in a $6.6 billion merger that would create the fifth-largest airline in the United States if approved.
The acquisition, according to Spirit and Frontier, will create a low-cost carrier that can compete with the major four US airlines (American, Delta, United, and Southwest), which control roughly 80% of the domestic market. According to Spirit and Frontier, the merger will save consumers $1 billion each year and create 10,000 new jobs by 2026.
The transaction is anticipated to close in the second half of 2022, but it must first get past regulators, who have already expressed reservations about airline alliances.
- The Justice Department filed a lawsuit in September to stop a “de facto merger” between American Airlines and JetBlue.
- Alaska Air was able to buy Virgin for $2.6 billion in 2016 thanks to a more merger-friendly Justice Department, but it had to scale back cooperation with American in order to do so.
Did you know? If Frontier and Spirit Airlines merged, they would control more than a quarter of the market at Orlando International Airport, more than any other airline.