MARKET WRAPS

Watch For:

Second estimate 3Q GDP; ADP National Employment Report for November; Chicago Business Barometer for November; EIA Weekly Petroleum Status Report; Royal Bank of Canada earnings

Opening Call:

Today's Headlines/Must Reads

- Jerome Powell Will Offer a New Mantra: Slow and Steady

- U.S. Not Seeking Decoupling From China, Commerce Chief Says

- Covid Controls Hit Chinese Factories, Adding Risks to Global Growth

- Junk Bonds Rally on Hopes Inflation Has Peaked

- Eurozone Inflation Eased in November, but Further Rate Rises Likely

- India's Central Bank to Launch Retail Pilot of Digital Rupee

- Twitter's Former Trust and Safety Chief Says He Left When System of Governance Went Away

Follow WSJ markets coverage here

Stock futures were slightly firmer on Wednesday as traders looked ahead to a speech from Jerome Powell.

Equities were closing out the month on a mildly positive note as traders eschewed big bets ahead of a speech by the Federal Reserve Chairman and a raft of crucial economic data in the next few days.

Despite fresh news of contracting China manufacturing, concerns about Covid restrictions in that country impacting the global economy appeared to have died down for now, allowing investors to refocus on the topic that has been driving stocks for much of the year: the Fed's monetary policy trajectory.

"A speech by Powell later today is expected to reiterate the central bank's determination to focus on inflation as its core objective, regardless of the potential ramifications," Interactive Investors said.

"Although such comments should be of little surprise, inevitably those searching for confirmation that the Fed will slow its round of rate hikes are likely to be disappointed once more."

Powell is due to speak at the Brookings Institution at 1.30 p.m. Eastern.

Deutsche Bank noted Powell's comments would likely be his last before the Fed begins its blackout period this weekend ahead of its December 14th policy meeting.

"In addition, today [Wednesday] will bring the latest data on job openings and the quits rate for October, which have recently been cited by the Fed and others as a key gauge of inflationary pressures from the labour market."

Global markets broadly rose, too. Travel, leisure and auto stocks helped push the Stoxx Europe 600 up 0.4%.

In Asia, China's Shanghai Composite Index added 0.1%. and the Hang Seng rose 2.2%, putting the Hong Kong benchmark on track for its biggest one-month advance since 1998.

Stocks to Watch

Crowdstrike: Predicted revenue of $619 million to $628 million for the current quarter, which fell short of the $634 million consensus estimate. Shares fell 19% after-hours.

Hewlett Packard Enterprise: Shares added 2.1% off hours after it reported a quarterly loss but gave an upbeat outlook for the coming fiscal year.

Horizon Therapeutics: Said it was fielding takeover interest from companies including Johnson & Johnson, Amgen and Sanofi, confirming an earlier Wall Street Journal report. Horizon shares rose 31% in after-hours trading.

Intuit: Beat expectations for revenue and earnings per share during the recent quarter. Its shares added 1.5% after hours.

NetApp: Reported fiscal second-quarter earnings above expectations but guidance came in lower than estimates. Its shares dropped 11% off hours.

Wayfair: Reported a bump in sales during the five-day shopping period from Thanksgiving through Cyber Monday. Wayfair recorded a low single-digit sales increase in the U.S. over the same period last year. Repeat customers accounted for 73% of holiday orders for the five-day period. Shares rose 11% after-hours.

Workday: Reported higher revenue for the recent quarter and lifted the low end of its subscription revenue guidance for fiscal 2023. Shares gained 8.5% off hours.

Other Movers

Alibaba, Baidu, JD.com and Pinduoduo: Shares in the Chinese tech companies rose 3%-5% premarket, suggesting they could build on Tuesday's rally.

Market Insight

Rate volatility has declined as the market seems to expect the Fed to let off the interest-rate-hike accelerator, PGIM Fixed Income said.

"As the market gains more clarity about the pace of hikes, more normal functioning may return to the bond market and more levered capital that depends on volatility metrics, such as value at risk, could return," PGIM said.

Nascent signs of that happening may emerge as off-the-run four- and six-year notes have been trading well lately even when one would expect to see investors demanding higher liquidity premiums.

Forex:

The dollar has been under less selling pressure lately, but ADP jobs data and Powell's speech could leave it vulnerable to further weakness, UniCredit Research said.

Investors "could return to selling the U.S. unit" if ADP data show an additional deceleration in net job creation.

More critically, when Jerome Powell discusses the economic outlook and the labor market later, any hints of the Fed slowing the pace of rate rises might prove negative for the dollar, although month-end position adjustments could help offset this, UniCredit said.

Read Dollar Heads For Biggest Monthly Loss Since 2010

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Eurozone inflation data for November are expected to show an easing in price pressures but this is unlikely to materially move the euro, ING said.

"The impact of the inflation story on the EUR/USD has been, predictably, limited. External factors and dollar dynamics continue to drive the pair's performance, and we see downside risks today given that Powell is scheduled to speak."

A fall in EUR/USD below 1.0300 could fuel more downside momentum, taking the pair to the 1.0200-1.0250 levels seen earlier this week, ING said.

Read Chinese Yuan Faces Renewed Falls Amid Covid-19 Uncertainty

Energy:

Oil prices held minor gains in early European trading, helped by a drawdown in crude stockpiles, but any rise for now has been tapered by the expectation OPEC+ will keep production flat at its meeting on Sunday.

Metals:

Base metals were under pressure in London trading, while gold gained, as investors continued to weigh China's Covid-19 rules and any possible shifts in U.S. monetary policy.

Investors in Asia were weighing "Covid-zero evolutions in China ahead of a much-anticipated speech from Jerome Powell," according to SPI Asset Management.

Gold, which is up 7% this month, "looks headed for its biggest monthly gain since May 2021 after the latest U.S. CPI reading sent dollar bulls cowering for cover," SPI added.

TODAY'S TOP HEADLINES

Twitter's Former Trust and Safety Chief Says He Left When System of Governance Went Away

Yoel Roth, Twitter Inc.'s former head of trust and safety, said several factors led to his decision to leave the platform after almost eight years, including the disruptions created by rapid-fire changes from the company's new owner.

He said he left the company following the botched launch of the upgraded Twitter Blue subscription program after Chief Executive Elon Musk ignored his team's warnings about possible issues tied to the rollout.

Airbnb Aims to Attract Big Landlords With a Cut of Its Rental Sales

Airbnb Inc. is launching a listing service for rental apartments with some of the biggest landlords and property managers in the country, a bid to expand its business in multifamily buildings where owners often shun short-term rentals.

The new service will feature more than 175 buildings managed by Equity Residential, Greystar Real Estate Partners LLC and 10 other companies, Airbnb said on Wednesday.

Apollo Taps Connecticut State Treasurer Shawn Wooden for New Client Role

Connecticut State Treasurer Shawn Wooden is joining Apollo Global Management Inc. as a partner and chief public pension strategist to help expand the New York firm's business with retirement systems, which typically are the largest investors in private-equity funds.

Mr. Wooden and Apollo "will comply with all relevant restrictions," an Apollo spokeswoman said, adding that he would join Apollo in late January.

Foot Locker Searches For a New Finance Chief

Foot Locker Inc. is searching for a new finance chief to succeed Andrew Page, who is stepping down from the shoe-store chain as part of a reshuffling of its senior ranks.

Mr. Page will transition out of his role after Foot Locker reports its fiscal fourth quarter earnings next year, the company said on Tuesday. Mr. Page, who has served as chief financial officer for just over a year, is leaving to pursue other opportunities, the company said. He was previously chief accounting officer and controller at Advance Auto Parts Inc., a Raleigh, N.C.-based auto parts retailer.

Horizon Therapeutics Fields Takeover Interest From Pharma Giants

Drugmaker Horizon Therapeutics PLC said it is fielding takeover interest, as large pharmaceutical companies compete for fast-growing medicines to fuel sales.

Horizon, which develops medicines for rare and immune diseases, said it is "engaged in highly preliminary discussions with Amgen Inc., [Johnson & Johnson's] Janssen Global Services, LLC and Sanofi" SA, confirming an earlier Wall Street Journal report on takeover interest.

Eurozone Inflation Eased in November, but Further Rate Rises Likely

The annual rate of inflation in the eurozone fell in November for the first time since mid-2021 , a development economists warned wouldn't keep the European Central Bank from increasing interest rates further.

Consumer-price inflation across the 19 countries that share the euro has increased since Russia's invasion of Ukraine, and the Kremlin's decision to weaponize the country's vast stores of energy to undermine European support for Kyiv.

Powell Will Offer a New Mantra: Slow and Steady

Federal Reserve Chairman Jerome Powell will have an opportunity on Wednesday to lay the groundwork for where the central bank is headed when policy makers meet next month-and he'll likely use it to make the case for slower but steady interest rate hikes.

In a speech Wednesday afternoon at the Brookings Institution, Powell is expected to reinforce the dual message central bank officials have been making for weeks: that the Fed is on track to ease up slightly on its pace of monetary policy tightening, likely slowing to a 50 basis point increase next month after four straight 75 basis point hikes.

U.S. Not Seeking Decoupling From China, Commerce Chief Says

WASHINGTON-The U.S. isn't seeking to decouple from China, U.S. Commerce Secretary Gina Raimondo will assert Wednesday, even as she emphasizes steps the U.S. is taking to safeguard its technology to ensure its economic competitiveness.

Ms. Raimondo is scheduled to speak Wednesday on U.S. competition with China at the Massachusetts Institute of Technology. At a briefing with reporters in advance, Ms. Raimondo highlighted the importance of promoting trade and investment in areas outside of core economic and national security interests.

Junk Bonds Rally as Investors Speculate Inflation Has Peaked

Investors are driving a modest end-of-year rally in junk bonds, erasing some of 2022's biting losses in a bet that the economic outlook for next year has stabilized.

Yields on below-investment-grade corporate bonds tracked by Intercontinental Exchange's index have declined to 8.76% through Monday's trading, down from a recent high of 9.61% on Oct. 13. Investors say they are growing more confident that interest rates might peak without putting many lower-rated companies' ability to repay debt in serious jeopardy.

Biden Administration Pressed by Allied Nations to Revise EV Subsidy Program

WASHINGTON-The Biden administration finds itself caught between its domestic-policy goals and some of its closest allies as it races against the clock to set the ground rules for new electric-vehicle subsidies.

The Treasury Department's Internal Revenue Service faces a year-end deadline to propose a guideline for how to qualify for EV tax incentives of up to $7,500 per vehicle under the tax and climate spending legislation known as the Inflation Reduction Act that President Biden signed in August.

Covid Controls Hit Chinese Factories, Adding Risks to Global Growth

SINGAPORE-Economic activity in China contracted further in November, adding pressure to a global economy already losing momentum as the war in Ukraine drags on and central banks raise interest rates to combat high inflation.

Gauges of activity in Chinese manufacturing, services and construction deteriorated by more than expected this month, a sign of weakening economic output as authorities persist in using widespread curbs on business and daily life to respond to Covid-19 outbreaks.

India's Central Bank to Launch Retail Pilot of Digital Rupee

India's central bank will launch its first pilot of a digital rupee for individual users on Thursday, putting it ahead of many major economies in the journey toward a sovereign virtual currency.

The Reserve Bank of India has said a digital rupee could provide Indians a safe alternative to risky private digital currencies.

Elon Musk's Neuralink Set to 'Show and Tell' Latest Brain-Computer Advances at Event

Elon Musk's neuroscience startup Neuralink Corp. is expected to give a progress report on its brain-implant technology in a highly anticipated streamed event Wednesday night.

In a tweet last week, the company teased a demo for the event, which begins at 9 p.m. New York time, with a short video that slowly spelled out the message "please join us for a show and tell." Some outside researchers said the video may indicate that a Neuralink device has been used to decode brain signals to type words on a screen, although they speculated that it would most likely be through a monkey or a wearable device.

Write to paul.larkins@dowjones.com TODAY IN CANADA

Earnings:

BRP 3Q

Natl Bank of Canada 4Q

Royal Bank of Canada 4Q

TECSYS 2Q

Economic Indicators:

None scheduled

Stocks to Watch:

Bausch Health Announces Unrestricting of Bausch + Lomb Under Bausch Health Debt Documents; Bausch + Lomb No Longer Subject to Covenants Under Bausch Health Debt Documents; Bausch Health Continues to Evaluate Potential Options to Maximize Stakeholder Value

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Enbridge Completes Partnership Agreement in Woodfibre; Enbridge Now Has 30% Ownership Stake in the Woodfibre LNG Project; Pacific Energy and Enbridge Will Each Make Pro-Rata Contributions During Construction Through Combination of Expected Asset Level Financing and Equity Investments; Enbridge: Project Remains on Track for Targeted In-Service Date of 4Q 2027

Expected Major Events for Wednesday

00:01/UK: CBI Service Sector Survey

00:01/UK: Nov Shop Price Index

01:00/JPN: Oct Steel Imports & Exports Statistics

04:30/JPN: Oct Preliminary Report on Petroleum Statistics

05:00/JPN: Oct Construction Orders

05:00/JPN: Oct Housing Starts

07:45/FRA: Oct Housing starts

07:45/FRA: Oct Household consumption expenditure in manufactured goods

07:45/FRA: Oct PPI

07:45/FRA: Nov Provisional CPI

07:45/FRA: 3Q GDP - detailed figures

08:55/GER: Nov Labour market statistics (incl unemployment)

09:00/ITA: 3Q GDP

10:00/ITA: Nov Provisional CPI

10:00/ITA: Nov Cities CPI

12:00/US: 11/25 MBA Weekly Mortgage Applications Survey

13:15/US: Nov ADP National Employment Report

13:30/US: 3Q 2nd estimate GDP

13:30/US: Oct Advance Economic Indicators Report

13:30/US: 3Q Preliminary Corporate Profits

14:45/US: Nov Chicago Business Barometer - ISM-Chicago Business Survey - Chicago PMI

15:00/US: Oct Pending Home Sales Index

15:00/US: Oct Job Openings & Labor Turnover Survey

15:30/US: 11/25 EIA Weekly Petroleum Status Report

19:00/US: U.S. Federal Reserve Beige Book

20:00/US: Oct Agricultural Prices

23:50/JPN: 3Q Quarterly Financial Statements Statistics of Corporations

All times in GMT. Powered by Onclusive and Dow Jones.

Expected Earnings for Wednesday

Allena Pharmaceuticals Inc (ALNAQ) is expected to report $-0.48 for 3Q.

Amtech Systems Inc (ASYS) is expected to report $0.11 for 4Q.

Box Inc (BOX) is expected to report $0.01 for 3Q.

Brp Inc (DOO.T,DOOO) is expected to report $2.45 for 3Q.

Build-A-Bear Workshop (BBW) is expected to report $0.38 for 3Q.

Costco Wholesale Corp (COST) is expected to report.

Credo Technology Group Holding Ltd (CRDO) is expected to report for 2Q.

Donaldson Co (DCI) is expected to report $0.70 for 1Q.

Five Below (FIVE) is expected to report $0.15 for 3Q.

Genasys Inc (GNSS) is expected to report for 4Q.

Great Panther Mining Ltd (GPL,GPR-T) is expected to report for 3Q.

Hennessy Advisors Inc (HNNA) is expected to report for 4Q.

Hormel Foods Corp (HRL) is expected to report $0.50 for 4Q.

Just Energy Group Inc (JE,JE.H.V) is expected to report for 2Q.

KE Holdings Inc - ADR (BEKE) is expected to report for 3Q.

La-Z-Boy Inc (LZB) is expected to report $0.85 for 2Q.

Leslie's Inc (LESL) is expected to report for 4Q.

National Bank of Canada (NA.T,NTIOF) is expected to report $2.25 for 4Q.

Nutanix Inc (NTNX) is expected to report $-0.60 for 1Q.

Okta Inc (OKTA) is expected to report $-1.39 for 3Q.

Ooma Inc (OOMA) is expected to report $-0.06 for 3Q.

PVH Corp (PVH) is expected to report $2.13 for 3Q.

Petco Health & Wellness Co Inc (WOOF) is expected to report for 3Q.

Portage Biotech Inc (PBT.U-L,PRTG) is expected to report for 2Q.

Pure Storage Inc (PSTG) is expected to report $-0.04 for 3Q.

Rogers Sugar (RSGUF,RSI.T) is expected to report for 4Q.

Royal Bank of Canada (RY,RY.T) is expected to report $2.68 for 4Q.

Salesforce Inc (CRM) is expected to report $0.11 for 3Q.

Schmitt Industries (SMIT) is expected to report for 1Q.

Semtech (SMTC) is expected to report $0.41 for 3Q.

Snowflake Inc (SNOW) is expected to report for 3Q.

Splunk Inc (SPLK) is expected to report $-1.04 for 3Q.

Synopsys Inc (SNPS) is expected to report $1.11 for 4Q.

TECSYS Inc (TCS.T) is expected to report $-0.01 for 2Q.

Titan Machinery (TITN) is expected to report $1.16 for 3Q.

Victoria's Secret & Co (VSCO) is expected to report for 3Q.

Yext Inc (YEXT) is expected to report $-0.15 for 3Q.

nCino Inc (NCNO) is expected to report for 3Q.

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ANALYST RATINGS ACTIONS

American Homes 4 Rent Cut to Outperform From Strong Buy by Raymond James

CinCor Pharma Cut to Equal-Weight From Overweight by Morgan Stanley

CinCor Pharma Cut to Perform From Outperform by Oppenheimer

Darden Restaurants Cut to Neutral From Outperform by Baird

Evergy Cut to Underperform From Outperform by Credit Suisse

Generac Cut to Underperform From Hold by Jefferies

Goodyear Tire Cut to Hold From Buy by Argus Research

Invitation Homes Cut to Outperform From Strong Buy by Raymond James

Paccar Raised to Neutral From Underperform by Exane BNP Paribas

Roku Cut to Sector Weight From Overweight by Keybanc

Surrozen Cut to Underweight From Neutral by JP Morgan

United Parcel Service Raised to Buy From Hold by Deutsche Bank

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

November 30, 2022 05:58 ET (10:58 GMT)

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