MARKET WRAPS
Watch For:
Conference Board Leading Indicators for October
Today's Top Headlines/Must Reads:
- Stock market surges toward 2023 high. Will holiday shoppers
put it over the top?
- The Hidden Hero Fueling Soft-Landing Hopes: A Boost in
Supply
- Office Landlords Can't Get a Loan Anymore
Opening Call:
Stock futures edged higher on Monday, with the Thanksgiving
holiday-shortened week beginning on a tentative note as markets
took a pause after recent strong gains.
"Markets are continuing to bask in the sunlight of easing
monetary conditions...The latest inflation data added to hopes that
the Federal Reserve could still be on track to engineer a soft
landing for the economy, with the consensus firmly of the opinion
that the interest rate hiking cycle has now ended," Interactive
Investor said.
"Economic releases are light although the arrival of Black
Friday will herald a current perspective of consumer demand, as the
run in to the festive season begins to gather some momentum," it
added.
Overseas Markets
Global stocks were mixed with Europe's Stoxx 600 close to flat,
while benchmarks in Asia mostly rose, as consumer and tech stocks
helped push Hong Kong's Hang Seng Index up 1.9%.
Premarket Movers
General Motors shares fell 0.2% after Kyle Vogt, CEO of Cruise
resigned . Vogt's resignation follows a Cruise accident in early
October that ultimately ended with the suspension of the company's
license to operate self-driving taxis in California.
Microsoft CEO Satya Nadella said Sam Altman, the ousted CEO at
OpenAI, would be joining the company to lead a new advanced AI
research team. Greg Brockman, OpenAI's president who resigned
Friday following Altman's dismissal, also will be hired as part of
the Microsoft team, Nadella said. Microsoft shares were rising 2%
in premarket trading.
Friday's Post-Close Mover
Baijiayun Group said it received a Nasdaq notification after
being late to filing its annual report for fiscal 2023. Shares fell
11%.
Economic Insight
Both the European Central Bank and the Fed could keep interest
rates high for long as economies weather the impact of rate hikes
well despite slowing down somewhat, DNB Asset Management said.
"Economies have proved resilient to higher rates and labor
markets are still quite tight, indicating that rates may need to be
kept at elevated levels for some time to come."
The first rate cuts could come in the second half of 2024, but
it is possible that rates could remain at present levels for the
whole year, DNB added.
Forex:
The dollar continued to fall on speculation that interest rates
have peaked, hitting two-and-a-half-month lows against a basket of
currencies including the euro, but selling of the currency may be
set for a pause, Swissquote said.
"The dollar index flirts with oversold conditions and tests
critical 200-day moving average support, indicating a potential
pause in the ongoing dollar selloff absent fresh news," it
said.
Energy:
Oil prices were rising with all eyes on this weekend's OPEC
meeting in Vienna.
Prices fell for the fourth week in a row last week. "The recent
weakness has increased noise over what OPEC+ will decide to do at
its meeting on Nov. 26," ING said.
ING expects Saudi Arabia and Russia to continue cutting supply
into early 2024, but that the wider OPEC+ group may also consider
cutting.
"A deeper group cut combined with the Saudis and Russians
rolling over their voluntary cut would be more than enough to
ensure that the surplus currently expected in 1Q24 disappears."
Metals:
Base metals were mixed and gold lower over worries about the
global economy.
BMI downgraded its 2024 price outlook for aluminum to $2,400 a
ton from $2,500 a ton amid weak demand.
"The sluggish growth of the global economy is expected to weigh
on aluminum demand in 2024, capping the upside to aluminum prices,"
BMI said.
However, prices should rise from current levels, with demand
growth expected to outstrip supply.
TODAY'S TOP HEADLINES
Bayer Shares Tumble After Clinical Trial Failure, Roundup Case
Loss
Bayer shares fell sharply after the company stopped a late-stage
study for a cardiovascular drug early due to lack of efficacy and
was ordered to pay $1.56 billion in a lawsuit relating to its
Roundup weedkiller.
At 0928 GMT, shares in the German
pharmaceutical-and-agricultural group traded 20% lower at EUR33.15,
at levels last seen in 2009.
AI Mania Powered Stocks This Year. Can Nvidia Spark More
Gains?
There is a lot riding on the earnings report this week from
Nvidia, both for the company's ebullient investors and the entire
stock market.
Nvidia has been the big winner of the bet that artificial
intelligence is the next big thing in tech, the so-called AI trade
that surged in popularity after OpenAI's release of its ChatGPT
app. The chip maker's shares have more than tripled this year,
contributing to a sizable portion of the S&P 500's 18%
rise.
Signature Bank's Apartment Loans Selling at a Steep Discount
A venture of two nonprofits and Related Fund Management is
poised to win an auction for billions of dollars of Signature Bank
loans backed by New York apartments, according to people familiar
with the matter.
The venture's leading bid of less than 70 cents of the loan's
face value shows how much the value of New York's rent-regulated
apartment sector has deteriorated in recent years.
Pro Take: Deflation Talk in the Air as CPI Heads Toward Fed
Target
The Federal Reserve's fight against inflation has dominated
headlines for months, but last week a pair of executives sounded
warnings about the potential for deflation, while a deep dive into
the latest consumer-price data by a Fed economist shows a broad
weakening in price pressures.
The core consumer-price index, which excludes gas and food
prices, has risen 4% over the past year, with about half of the
increase coming from housing and rents, Brent Meyer, Atlanta Fed
economist, said after the government released its CPI report for
October on Tuesday.
Wall Street's ESG Craze Is Fading
Wall Street rushed to embrace sustainable investing just a few
years ago. Now it is quietly closing funds or scrubbing their names
after disappointing returns that have investors cashing out
billions.
The about-face comes after tightened regulatory oversight,
higher interest rates that have slammed clean-energy stocks and a
backlash that has made environmental, social and
corporate-governance investing a political target.
How a Hack Shook Wall Street's Multitrillion-Dollar
Foundations
The recent hack of a Chinese banking giant reignited Wall
Street's long-running fears of disruptions to the short-term cash
markets underpinning the global financial system.
Traders swiftly contained the cyberattack on the Industrial and
Commercial Bank of China. But some said the incident exposed cracks
in the multitrillion-dollar market for repurchase agreements, known
as repo, where banks and hedge funds borrow cash mainly using
Treasurys as collateral.
Israel's War in Gaza Tests Limits of Biden's Support
WASHINGTON-President Biden is struggling to persuade Israeli
Prime Minister Benjamin Netanyahu to take steps U.S. officials
believe could help prevent the conflict in Gaza from further
escalating, straining the relationship between the two longtime
allies, according to U.S. and European officials.
Over the past two weeks, Biden has pushed Netanyahu on issues
ranging from limiting civilian casualties to agreeing to a pause in
fighting to free hostages. While there has been agreement in some
areas, such as when Israeli commanders accepted American advice not
to rush into Gaza immediately, U.S. officials are still concerned
about Israel's ultimate plans for Gaza, including any sort of
extended occupation, and are alarmed by the number of Palestinian
casualties.
Write to ina.kreutz@wsj.com
TODAY IN CANADA
Earnings:
Nothing major scheduled
Economic Calendar (ET):
Nothing major scheduled
Stocks to Watch:
SNDL and Nova Cannabis Terminate Implementation Agreement; SNDL
and Nova Cannabis Reaffirm Commitment to Ongoing Partnership;
Maturity Date of Nova Cannabis Credit Facility With SNDL Extended
to March 31; Previously Planned Distribution of Nova Common Shrs to
SNDL Hldrs Won't Proceed at This Time
Expected Major Events for Monday
05:00/JPN: Oct Convenience Store Sales
07:00/GER: Oct PPI
11:00/UK: Oct Aluminium Production report
15:00/US: Oct Leading Indicators
All times in GMT. Powered by Kantar Media and Dow Jones.
Expected Earnings for Monday
Aerovate Therapeutics Inc (AVTE) is expected to report for
3Q.
Air Industries Group (AIRI) is expected to report for 3Q.
Akerna Corp (KERN) is expected to report for 3Q.
Alpine Immune Sciences Inc (ALPN) is expected to report $-0.40
for 3Q.
Arcimoto Inc (FUV) is expected to report for 3Q.
Arlington Asset Investment Corp (AAIC) is expected to report
$0.24 for 3Q.
Atlantic American (AAME) is expected to report for 3Q.
Ayala Pharmaceuticals Inc (ADXS) is expected to report for
3Q.
Bellerophon Therapeutics Inc (BLPH) is expected to report for
3Q.
Bengal Energy Ltd (BNG.T) is expected to report for 2Q.
Bird Global Inc (BRDS) is expected to report for 3Q.
CPI Aerostructures Inc (CVU) is expected to report $0.21 for
3Q.
Checkpoint Therapeutics Inc (CKPT) is expected to report for
3Q.
Chicken Soup for the Soul Entertainment Inc (CSSE) is expected
to report $-1.17 for 3Q.
ContraFect Corp (CFRX) is expected to report for 3Q.
Drive Shack Inc (DSHK) is expected to report $-0.06 for 3Q.
Exela Technologies Inc (XELA) is expected to report for 3Q.
Focus Universal Inc (FCUV) is expected to report for 3Q.
Gelesis Holdings Inc (GLSHQ) is expected to report for 3Q.
Gyrodyne LLC (GYRO) is expected to report for 3Q.
Impel Pharmaceuticals Inc (IMPL) is expected to report for
3Q.
Infinity Pharmaceuticals Inc (INFIQ) is expected to report $0.03
for 3Q.
Legend Biotech Corp - ADR (LEGN) is expected to report for
3Q.
Lendway Inc (LDWY) is expected to report for 3Q.
Lightning eMotors Inc (ZEVY) is expected to report for 3Q.
National American University Holding Inc (NAUH) is expected to
report for 2Q.
NexImmune Inc (NEXI) is expected to report for 3Q.
Odyssey Marine Exploration Inc (OMEX) is expected to report for
3Q.
Omnitek Engineering (OMTK) is expected to report for 3Q.
Precipio Inc (PRPO) is expected to report for 3Q.
PrimeEnergy Resources Corp (PNRG) is expected to report for
3Q.
Remark Holdings Inc (MARK) is expected to report for 3Q.
San Juan Basin Royalty Trust (SJT) is expected to report for
3Q.
Singing Machine Co Inc (MICS) is expected to report for 2Q.
Sunlight Financial Holdings Inc (SUNLQ) is expected to report
for 3Q.
Unity Biotechnology Inc (UBX) is expected to report for 3Q.
Viridian Therapeutics Inc (VRDN) is expected to report for
3Q.
WVS Financial Corp (WVFC) is expected to report for 1Q.
Williams Industrial Services Group Inc (WLMSQ) is expected to
report $-0.03 for 3Q.
Zynerba Pharmaceuticals Inc (ZYNE) is expected to report $-0.20
for 3Q.
Powered by Kantar Media and Dow Jones.
ANALYST RATINGS ACTIONS
Agilent Cut to Neutral From Buy by UBS
Air Products & Chemicals Cut to Sell From Buy by Redburn
Atlantic
Airbnb Cut to In-Line From Outperform by Evercore ISI Group
Analog Devices Raised to Overweight From Equal-Weight by Morgan
Stanley
Brookdale Senior Living Raised to Outperform From Sector Perform
by RBC Capital
Cano Health Cut to Sell From Neutral by UBS
CareMax Cut to Neutral From Buy by UBS
ChargePoint Cut to Hold From Buy by RF Lafferty
ChargePoint Cut to Neutral From Buy by Janney Montgomery
Scott
ChargePoint Cut to Perform From Outperform by Oppenheimer
Cisco Systems Cut to Hold From Buy by DZ Bank
Expedia Group Raised to Outperform From In-Line by Evercore ISI
Group
GitLab Cut to Equal-Weight From Overweight by Barclays
Hubbell Raised to Overweight From Neutral by JP Morgan
Kodiak Sciences Raised to Overweight From Equal-Weight by
Capital One
Kulicke & Soffa Raised to Buy From Hold by Craig-Hallum
Larimar Therapeutics Raised to Buy From Neutral by Citigroup
Leidos Holdings Raised to Buy From Hold by Argus Research
Marriott Vacations Cut to Underperform From Neutral by B of A
Securities
Pacific Biosciences Raised to Buy From Neutral by UBS
Palisade Bio Raised to Buy From Hold by Maxim Group
Processa Pharmaceuticals Cut to Hold From Buy by Maxim Group
Roblox Raised to Peer Perform From Underperform by Wolfe
Research
Triumph Financial Cut to Neutral From Buy by DA Davidson
WestRock Raised to Buy From Hold by Argus Research
Zoom Video Communications Raised to Neutral From Sell by
Citigroup
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
November 20, 2023 06:12 ET (11:12 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.
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