10 things you need to know in markets August 24

A
Federal Reserve police officer keeps watch while posted outside
the Federal Reserve headquarters in Washington September 16,
2015.
REUTERS/Kevin
Lamarque

Good morning! Here’s what you need to know in markets on Friday.

1. Federal
Reserve policymakers broadly agree that U.S. interest rates
should rise further this year and next, despite U.S. President
Donald Trump’s displeasure with such a plan, two policymakers’
comments underscored on Thursday. “Based on what I
see today, I think two more rate hikes could be appropriate,”
along with several more next year as the Fed aims to move
interest rates to a neutral setting of about 3 percent, Kansas
City Fed Bank President Esther George told Bloomberg TV. 

2. Microsoft
is being investigated by U.S. authorities over potential bribery
and corruption related to software sales in Hungary, the Wall
Street Journal reported on Thursday. The U.S.
Justice Department and the Securities and Exchange Commission are
probing how Microsoft sold its software such as Word and Excel to
middleman firms in Hungary at steep discounts, the report said.

3. China
will keep hitting back at Washington as more U.S. trade tariffs
are imposed, but its counter-strikes will remain as targeted as
possible to avoid harming businesses in China – whether Chinese
or foreign, Finance Minister Liu Kun said. For
now the impact of the China-U.S. “trade frictions” on the Chinese
economy has been small, but he is concerned about potential job
losses and lost livelihoods.

4. Alphabet’s
self-driving unit Waymo has set up a subsidiary in Shanghai,
according to a business registration filing, the latest sign that
the U.S. internet giant is attempting to make new inroads into
China. Waymo established a wholly-owned company
called Huimo Business Consulting (Shanghai) Co on May 22 in
Shanghai’s free trade zone with registered capital of 3.5 million
yuan ($509,165), according to China’s National Enterprise
Information Publicity System.

5. Britain’s
biggest carmaker Jaguar Land Rover has given the go-ahead to
production of an electric version of its E-type sports car with
first deliveries planned for the summer of 2020, the company said
on Thursday. Jaguar Classic, a unit of the
UK-based automaker which restores vintage Jaguar cars, will
convert the vehicles to electric power at its Classic Works
facility in Coventry.

6. Funds
run by Fidelity Investments sided with Tesla management on
director votes and other controversial items this spring, filings
showed on Thursday, which experts said could presage further
support for the carmaker’s CEO, Elon Musk, as he looks to take
the company private. Fidelity funds that are top
Tesla holders including Blue Chip Growth Fund, Growth Company
Fund and Contrafund all voted as Tesla recommended at two
shareholder meetings held in March and June, the filings showed.

7. Elon
Musk has hired Morgan Stanley to assist him in his
potential bid to take Tesla private, according to a person
familiar with the matter. Morgan Stanley is advising
Musk, not the company, its board or a special board committee
formed to to evaluate a potential take-private proposal, said the
person, who asked not to be identified because the matter is
private.

8. The
U.S. Senate voted overwhelmingly on Thursday for legislation to
fund much of the government, including $675 billion for the
Department of Defense, as lawmakers worked to minimize the risk
of a government shutdown before the fiscal year ends Sept
30. The Senate voted 85-7 to pass the $854 billion
measure, which combines funding for the Pentagon with money for
domestic programs including the Health and Human Services,
Education and Labor Departments.

9. Bell
Helicopter Textron has been awarded a $510 million U.S. defense
contract for 29 AH-1Z helicopters for the Marine Corps, the
Pentagon said on Thursday.

10. HP,
which houses the hardware business of former Hewlett-Packard,
reported a 26.4 percent rise in quarterly profit on Thursday, due
to strength in its personal systems that sells notebooks and
desktops. The company’s net earnings rose to
$880 million, or 54 cents per share, in the third quarter ended
July 31, from $696 million, or 41 cents per share, a year
earlier.