Market Munch 🍕| 2 August 2022
Putin helps get food on plates around the world, Germany consumer confidence seems nowhere in sight, and Aramco & Pepsi go on a shopping spree.
Happy morning, Munchers!
Here is your daily dose of the news that matters, from Wall Street to Dalal Street - in 5 minutes and 11 seconds.
Let’s dive in.
What’s hot, what’s not
Story Roundup
1 - Ukraine's first grain ship gets into the water. 🌽🌽🌽
In a crucial deal between Russia and Ukraine to cool global food prices, a ship carrying 26k tons of Ukrainian corn has left the Black Sea port.
Russia and Ukraine came to this deal “for the good of the world” - as combined they make up about 13% of the global wheat market.
Lesser supply of wheat means higher prices for whatever wheat is remaining across markets - pushing prices up and straining consumers who are already dealing with decades-high inflation.
Russia went back on this ceasefire and bombed a ship last week - but all seems to be well now.
2 - German retail sales fall by the largest rate on record. 😬\
In the latest sign of trouble in Europe’s largest economy, German retail sales dropped 8.8% for the month of June - a record.
This comes after a slew of disappointing economic data - as German inflation shocked economists and came in higher than expectations at 8.5%.
Retail sales plunging show one big thing - the fact that soaring inflation is hurting consumer spending.
Fingers crossed for this one.
3 - Pepsi splashes half a yard on a drink maker. 🥤
Pepsi just spent about $560m to pick up an 8.5% stake in sports drink manufacturer Celsius.
It’s an interesting investment for Pepsi - as Celsius saw a Q1 revenue increase of 220% and operates in a pretty hot segment.
Celsius makes drinks that cater to the uber-woke crowd of today - offering zero preservatives, zero sugar and zero calorie drink options.
Pepsi’s been trying to take a dip in the energy drink market for a while now, with an acquisition of Rockstar and a distribution partnership with Bang Energy.
A play for the future. 🤷
4 - Saudi Aramco spends $2.65bn on Valvoline’s products arm. 💸
You gotta spend money to make money - and Saudi Aramco is spending over $2.5bn on Valvoline’s products arm.
The products division sells lubricants, engine oil, and engine maintenance products in over 140 countries.
Aramco’s spreading into a few other verticals - and according to them, this deal “fits perfectly with Aramco’s growth strategy”.
They’re the world’s largest producer of crude - and it looks like they’re gonna get even stronger. 🛢️
5 - Zomato pleases Dal Street and Dalal Street.🥡
Zomato has burned about 70% of their value since their peak - but their earnings look like they will offer some salvation.
They halved their operating loss quarter-on-quarter from $48.5m (366Cr) to $25.2m (186Cr).
Their top-line revenue also came in extremely healthy - a 67% increase from the same period last year, now sitting at about $192m.
Zomato’s focus on becoming a more profitable business is certainly working - and it looks like the business is going to get stronger from here.
Aaaand that’s a wrap.
Happy day guys.
Thanks a ton for reading. Hope you enjoyed it. Any feedback is open - positive or negative. Hit my line at aryaansh.rathore@gmail.com or https://www.linkedin.com/in/aryaansh/.