U.S. index futures were slightly up in pre-market trading this
Tuesday, focusing on consumer inflation and the Federal Reserve
meeting. Expectations for rate cuts by the Fed next year have
decreased, with the markets foreseeing a 45% chance of a cut in
March, down from 57% the previous week, according to the CME
FedWatch tool.
At 05:06 AM, Dow Jones futures (DOWI:DJI) rose
66 points, or 0.18%. S&P 500 futures were up
0.10% and Nasdaq-100 futures increased 0.16%. The
yield on the 10-year Treasury bonds was at 4.199%.
In the commodities market, West Texas Intermediate crude oil for
January was up 0.39%, at $71.62 per barrel. Brent crude for
February rose 0.34%, near $76.31 per barrel. Iron ore with a 62%
concentration, traded on the Dalian exchange, went up 1.52%, to
$135.08 per ton.
On Tuesday’s economic agenda, investors await at 08:30 AM the
November consumer price index reading by the Department of Labor.
Economists project that U.S. consumer inflation remained stable in
November compared to the previous month and rose 3.1% on an annual
basis. The Fed’s two-day meeting also starts today, and it is
expected that the U.S. central bank will keep interest rates stable
at 5.25% to 5.5%.
European markets are on the rise, focusing on the UK’s labor
market data. Investors are waiting for this data to assess its
impact on inflation before the Bank of England’s meeting on
Thursday. Wages, excluding bonuses, are expected to rise by 7.4% in
the three months to October, indicating a slight decline from
September’s 7.7%. These numbers keep the central bank alert to
inflationary pressures.
Asian markets closed higher, with Hong Kong standing out before
the last Federal Reserve meeting of the year in the U.S. Producer
prices in Japan increased more than expected, with a 0.3% annual
gain. The Japanese yen slightly strengthened against the dollar.
Major Asian indices recorded the following gains: Shanghai SE
(+0.40%), Nikkei (+0.16%), Hang Seng (+1.07%), Kospi (+0.16%), ASX
200 (+0.50%).
In Monday’s trading, stocks ended moderately higher, reaching
their best closing levels in over two years. Dow Jones rose 0.43%,
S&P 500 0.39%, and Nasdaq 0.20%. The market was cautious ahead
of the Federal Reserve’s policy announcement. Semiconductor and
network sectors saw significant gains, while gold stocks fell.
On Tuesday’s corporate earnings front, investors will be
watching reports from Johnson Controls (NYSE:JCI),
Mama’s Creations (NASDAQ:MAMA),
Emcore (NASDAQ:EMKR), Loop
(AMEX:LPTV), and Champions Oncology
(NASDAQ:CSBR).
Wall Street Corporate Highlights for Today
Apple (NASDAQ:AAPL) – Apple
plans to offer incentives to artists and record labels to produce
music in spatial audio with Dolby Atmos technology starting next
year. This could result in higher royalty payments. Mixing music in
Dolby Atmos is widely accessible and supported by
Apple‘s audio products.
Microsoft (NASDAQ:MSFT) –
Microsoft and AFL-CIO have agreed on a union
neutrality deal, allowing the company to remain neutral in employee
unionization efforts. Additionally, the two parties will
collaborate on the future of artificial intelligence and the impact
of technology on the workforce.
Alphabet (NASDAQ:GOOGL) –
Alphabet‘s Google lost an antitrust case brought
by Epic Games, maintaining its monopoly on app distribution and
payments in the app store. Epic claimed that Google exploited app
developers and stifled competition. Google plans to contest the
verdict.
Oracle (NYSE:ORCL) – Oracle
fell 8.6% in Tuesday’s pre-market after reporting second-quarter
revenue of $12.94 billion, below the average estimate of $13.05
billion, according to LSEG data. The adjusted earnings of $1.34 per
share for the quarter ended November 30 narrowly beat estimates.
Oracle forecasted below-estimate quarterly revenue
due to competition in the cloud computing market and economic
uncertainty. Inflation and high borrowing costs impacted business
spending, affecting companies like Oracle. The
acquisition of Cerner might also have impacted the results.
JD.com (NASDAQ:JD) – JD.com‘s
founder Richard Liu acknowledged inefficiency and poor management
issues in the e-commerce giant during an internal employee forum.
He responded to a criticism from an employee about the platform’s
complexity and pricing strategy. Liu promised changes and
encouraged the team to join him in reforming the company.
Netflix (NASDAQ:NFLX) –
Netflix resolved “technical issues” that caused an
outage for most users in the U.S., according to the streaming
giant. The outage affected thousands of users on Monday but was
resolved. Downdetector reported 984 outages after a peak of 17,000
reports.
Disney (NYSE:DIS) – Reliance
Industries (USOTC:RLNIY) and Walt Disney
are finalizing a non-binding agreement to merge their media
operations in India. Reliance will have 51%,
Disney 49%, and the deal might be announced in
January, with a new Viacom18 unit absorbing
Disney‘s Star India through a stock swap deal.
Nokia (NYSE:NOK) – Nokia
revised down its comparable operating margin target to 13% by 2026,
due to losing a contract with AT&T (NYSE:T).
The company plans to cut costs and aim for a double-digit margin on
sales of 10 billion euros by 2026.
BlackBerry (NYSE:BB) –
BlackBerry appointed John Giamatteo, head of its
cybersecurity unit, as CEO and scrapped plans to separate its IoT
and cybersecurity divisions. The units will operate independently
and profitably.
Berkshire Hathaway (NYSE:BRK.B) –
Warren Buffett‘s Berkshire
Hathaway halved its stake in HP Inc.
(NYSE:HPQ), moving from the second-largest shareholder to the
third-largest, while Carl Icahn resigned from the board of
FirstEnergy Corp. (NYSE:FE) due to reducing his
stake in the company.
JPMorgan Chase (NYSE:JPM) – JPMorgan
Chase plans to outsource its local custody operations in
Hong Kong and Taiwan to Citigroup (NYSE:C),
HSBC (NYSE:HSBC), and Standard
Chartered (LSE:STAN). This follows the bank’s exit from
local custody business in other Asian markets due to lower margins
and a drop in assets under custody. Additionally,
JPMorgan plans to renovate branches acquired from
First Republic Bank to expand its presence,
opening 167 new locations, despite the decline in U.S. bank
branches. The bank aims to retain 90% of First
Republic‘s customers and enhance service to wealthy
clients.
Goldman Sachs (NYSE:GS) – Goldman
Sachs hired Paul Camp, former Wells Fargo
(NYSE:WFC) executive, as head of its transaction banking sector.
The hiring follows the dismissal of executives from the transaction
banking unit in September for violating the company’s communication
policy.
Bank of America (NYSE:BAC) – Bank of
America promoted 334 employees to managing directors,
including investment bankers and commercial division professionals.
Over half of the promotions were to minorities.
Discover Financial Services (NYSE:DFS) –
Michael G. Rhodes will assume the role of CEO and board member of
Discover Financial Services on March 6. Interim
CEO John Owen will continue as a director of the company and the
bank. Rhodes has over 25 years of experience in the financial
services sector.
Occidental Petroleum (NYSE:OXY) –
Occidental Petroleum agreed to acquire shale oil
producer CrownRock in a $12 billion deal, including debts,
expanding its presence in the U.S. shale oil field. The deal comes
amid a new wave of shale consolidation backed by major oil
companies.
Petrobras (NYSE:PBR) – The IATA urged the
Brazilian government and Petrobras to adjust how
aviation fuel is charged in the country, claiming that kerosene
prices are “excessively high” and do not reflect the reality of an
oil-producing country. IATA also criticized the heavy taxes on
kerosene in Brazil.
Boeing (NYSE:BA) – Boeing
plans to halve the number of planners in its main divisions as part
of a strategic reorientation. This follows the appointment of
Stephanie Pope as Chief Operating Officer, as the company faces
financial challenges.
Ford Motor (NYSE:F) – Ford
plans to halve the production of its F-150 Lightning electric
pickups in 2024 due to a shift in market demand, reducing to about
1,600 units per week instead of the initial plans of 3,300. The
company will adjust to customer demand.
Lucid Group (NASDAQ:LCID) – Sherry House left
her position as CFO of Lucid Group to seek new
opportunities, with Gagan Dhingra serving as interim CFO.
Lucid Group, known for its luxury electric sedan
Air, revised its production forecast for this year downwards.
AbbVie (NYSE:ABBV), Revance
Therapeutics (NASDAQ:RVNC), Evolus
(NASDAQ:EOLS), Supernus Pharmaceuticals
(NASDAQ:SUPN) – Public Citizen asked the U.S. FDA to require
stronger warnings about the risk of botulism in Botox injections
and similar products, even at recommended dosages. The petition is
based on over 5,400 reports of serious adverse events.
Sanofi (NASDAQ:SNY) – Sanofi
announced that it would nullify its agreement with Maze
Therapeutics after the Federal Trade Commission attempted to block
it, alleging that the deal would eliminate competition in the
treatment of Pompe disease. Sanofi disagreed with
the FTC’s decision, emphasizing that the partnership aimed to
accelerate the development of a treatment for this rare genetic
condition.
Hasbro (NASDAQ:HAS) – Hasbro
announced the elimination of over 900 jobs globally, a year after
announcing a 15% workforce reduction due to weak sales. This brings
the total to 1,900 job cuts, representing 29% of its staff. The
company aims to save up to $400 million annually by the end of
2025.
Grocery Outlet (NASDAQ:GO) – CFO Charles
Bracher will leave his position at Grocery Outlet Holding
Corp. on March 1st “to pursue another opportunity.”
Accounting Director Lindsay Gray will act during the transition,
and the search for a replacement is ongoing. The company maintained
its outlook for the 2023 fiscal year.
Unilever (NYSE:UL) – The UK’s Competition and
Markets Authority is investigating Unilever’s
environmental claims, concerned that the company might mislead
buyers about the environmental impact of products like Dove and
Lynx, as well as the use of colors and images that may create a
misleading impression.
Unilever (NYSE:UL)
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