World Street | Europe treads Fed trail on rates, Buffett bets on Occidental Petro, drug makers in pain, GM in firing mood

World Street offers a sneak peek into the world of business and economy.

The European Central Bank seems to have toed the line of the US Federal Reserve in keeping the key lending rate unchanged. And, so did the Bank of England. Warren Buffett bets it big on Occidental Petroleum, picking up millions of shares. Pharma companies may need a healing potion if they need to offer discounts to consumers in an environment of outrageous price hikes. All this and more on this edition of World Street.

Staying Put

The European Central Bank on Thursday held interest rates steady for the second time in a row, but revised its growth forecasts lower and announced plans to speed up the shrinking of its balance sheet. The ECB was widely expected to leave the policy rate unchanged in light of the sharp fall in euro zone inflation, similar to the trend seen in the US.

Higher for Longer

The Bank of England on Thursday kept its main interest rate unchanged at 5.25 percent but said the monetary policy may "need to be restrictive for an extended period" of time. The British central bank held rates steady for a third consecutive meeting with the headline inflation down to an annual 4.6 percent in October, hitting its lowest point in two years.

Cost to go Green

US wireless carrier AT&T plans to purchase some electric vehicles from startup Rivian in a pilot programme to evaluate ways to reduce cost, cut carbon emissions and improve safety. The deal is the first for Rivian after the company ended its exclusivity pact with largest shareholder Amazon for its delivery vans, opening the door for more customers, last month.

Loading Up

Warren Buffett-led Berkshire Hathaway has acquired nearly 10.5 million shares of Occidental Petroleum so far this week for about $588.7 million, according to a filing at the US Securities and Exchange Commission. The purchases bring Berkshire's stake in Occidental to about 27 percent. The company also holds preferred shares and warrants to acquire another 83.8 million Occidental shares for $4.7 billion, or $56.62 apiece.

Pharma Pain

Dozens of pharmaceutical companies will be required to pay rebates to Medicare for "outrageous" price hikes on prescription drugs, Reuters reports. For the last quarter of 2023, prices of 48 Medicare Part B drugs spiralled faster than inflation, according to the White House, which also said some big pharmaceutical companies raised the prices of certain medications every quarter through the year.

Win for Amazon

Europe’s top court sided with Amazon in a case in which the US e-commerce giant was accused by the European Commission of illegal tax benefits. The European Court of Justice (ECJ) said that the Commission had “not established” that a tax agreement between Amazon and Luxembourg was “a state aid that was incompatible with the internal market.”

Broken Bonds

Citigroup has closed its US municipal bond operations, as CEO Jane Fraser tried to maximise profits. The business was “no longer viable, given our commitment to increase the firm’s overall returns,” said an internal memo. The move is expected to impact around hundred staffers, reported FT.

Hit the Brakes

GM’s Cruise will lay off 24 percent of its workforce or around 900 employees. The employees affected have been part of its commercial operations and corporate functions. The robotaxi company has been in the news for for an October 2 accident, where a pedestrian was struck and dragged 20 feet by a self-driving Cruise cab.

Healing the Skin

The cancer vaccine jointly developed by Moderna and Merck, when used along with Merck’s  therapy Keytruda, cut the risk of death or relapse in patients for the deadliest type of skin cancer by 50 percent over a period of approximately three years.