ORCL Oracle Corp

US index futures are down in pre-market trading this Monday, amid a broad return of risk aversion sentiment, due to indications from central banks that interest rates will remain high for an extended period.

At 06:55, Dow Jones (DOWI:DJI) futures dropped 15 points, or 0.04%. S&P 500 futures fell 0.05% and Nasdaq-100 futures fell 0.08%. The yield on 10-year Treasury bonds was at 4.491%.

In the commodities market, West Texas Intermediate crude oil for November rose 0.12%, to $90.14 per barrel. Brent crude for November rose 0.23% near $93.48 per barrel. Concentrated 62% iron ore fell 2.03%, quoted at $115.45 per tonne, after increased concerns about the Chinese real estate sector.

On Monday’s U.S. economic agenda, investors await the release of activity items from two important districts, such as Chicago and Dallas, at 8:30 and 10:30 respectively, where major industries are concentrated.

In Europe, the schedule is quiet, with only the release of the business climate in Germany by the Ifo Institute. In September, the indicator reached 85.70 points, exceeding the consensus of 85.20 points, showing monthly stability after a series of declines.

At 09:00, a statement from the President of the European Central Bank (ECB), Christine Lagarde, is scheduled. She will likely discuss the management of monetary policy in the euro zone, aiming to achieve the 2% inflation target.

In Asia, markets concluded with mixed results, impacted by recent tension on Wall Street and renewed concerns about the Chinese real estate sector. Stocks in this sector experienced significant losses, especially Evergrande, which fell almost 25% in Hong Kong.

As reported by Bloomberg, Evergrande, a Chinese company, canceled crucial creditor meetings scheduled for this week. “Based on the company’s current condition and consultations with creditors, the company deems it essential to reassess the terms of the suggested restructuring to conform to the situation and the needs of the creditors,” Evergrande stated in a note.

Moreover, Evergrande reported that it is unable to issue new bonds due to an investigation into the subsidiary Hengda Real Estate by the China Securities Regulatory Commission for possible violations of information disclosure norms.

At Friday’s close, the Dow Jones fell 106.58 points or 0.31% to a two-month closing low of 33,963.84 points. The S&P 500 also fell 9.94 points or 0.23% to a three-month closing low of 4,320.06 points. The Nasdaq Composite fell 12.18 points or 0.09% to 13,211.81, its lowest closing level in more than three months.

Some members of the Federal Reserve, including board member Michelle Bowman, highlighted the possibility of at least one additional increase in interest rates in the country. On the other hand, in China, additional stimulus measures were announced, with the local governments of Shanghai and Beijing relaxing new regulations related to foreign investment, which is considered a positive aspect.

Wall Street Corporate Highlights for Today

Ford Motor (NYSE:F) – Ford Motor indicated that there are still “significant gaps to fill” on economic issues crucial to a new labor agreement with the United Auto Workers (UAW) union. While UAW has expanded strikes against other manufacturers, negotiations with Ford advance, but serious problems persist. Canadian union Unifor, representing 5,600 workers, ratified a new three-year contract with Ford Motor, avoiding strikes in Canada. Ford offered union members pay raises of up to 25% and bonuses in their new contract.

General Motors (NYSE:GM), Stellantis (NYSE:STLA) – The US auto industry is on strike, affecting GM and Stellantis dealers. The shutdown impacts the sale and maintenance of parts, crucial for profits. Resellers, facing supply difficulties, foresee challenges in serving customers. A quick solution is expected, minimizing inconvenience for consumers and companies.

Warner Bros. Discover (NASDAQ:WBD), Disney (NYSE:DIS), Netflix (NASDAQ:NFLX), Paramount (NASDAQ:PARA), Dish Network (NASDAQ:DISH), Comcast (NASDAQ:CMCSA) – Hollywood writers and studios have reached a tentative agreement, ending a prolonged strike that impacted TV and movie productions. The three-year deal includes increased royalties and protections against artificial intelligence. This resolution potentially paves the way for agreements with also striking actors.

Amazon (NASDAQ:AMZN) – The Federal Trade Commission will launch antitrust proceedings against Amazon, marking the latest U.S. effort to regulate big tech companies. Amazon is accused of anti-competitive practices and abuse of market power. Additionally, Amazon will incorporate limited advertising into Prime Video in 2024, aiming to fund more compelling content. Advertising will be less frequent than on other streaming and linear TV. Users in the US can opt for an ad-free service for an extra $2.99 ​​per month. In other news, Amazon plans to invest up to $4 billion in Anthropic, a generative artificial intelligence startup, moving much of Anthropic’s software to Amazon Web Services. This investment gives Amazon a minority stake in Anthropic and marks a significant advancement in Amazon’s quest to become a leader in AI, providing Anthropic with access to advanced computing power and substantial funding, crucial for developing advanced AI models.

Apple (NASDAQ:AAPL) – Apple has plans to quintuple its production in India over the next five years, aiming to reach US$40 billion in production. India, looking to diversify its supply chains, aims to expand its electronics industry to $300 billion by 2026.

Oracle (NYSE:ORCL) – Oracle agreed to pay $104.1 million up front for chips from startup Ampere Computing and invested an additional $400 million through a convertible note. This investment aims to give Oracle’s cloud an edge against rivals like Amazon (NASDAQ:AMZN) and Google (NASDAQ:GOOGL), which manufacture their own chips.

HP Inc (NYSE:HPQ) – Warren Buffett’s Berkshire Hathaway (NYSE:BRK.B) recently sold HP Inc. shares valued at about $130 million, following an earlier sale worth $160 million. With an 11.2% stake in HP, any changes need to be filed with the SEC. These sales signal a possible continued reduction in participation. Berkshire acquired the shares for approximately $30 each, likely incurring a loss. HP has lowered its fiscal 2023 projections, raising questions about future sales.

Morgan Stanley (NYSE:MS) – Morgan Stanley’s Michael Wilson predicts a less favorable outlook for consumer stocks, reflecting the possible inability of household spending to maintain the surprising strength seen. This view is supported by analysis from Goldman Sachs (NYSE:GS) and Jefferies (NYSE:JEF), suggesting caution with the consumer discretionary sector and specific companies. The recommendation is a balance of defensive and cyclical assets.

Citigroup (NYSE:C) – Citigroup has warned its UK employees of possible layoffs due to a reorganization. This action could affect hundreds of jobs as the bank aims to realign its organizational structure with its current strategy. The specifics and exact numbers are still unknown.

Deutsche Bank (NYSE:DB) – Deutsche Bank has hired technology savvy Ainslee Withey from Barclays (BCS, B1CS34) as director for its technology investment banking group, focusing on internet trading. Based in San Francisco, she will contribute to Deutsche’s efforts to expand its franchise in the Americas.

Coinbase (NASDAQ:COIN) – Coinbase is looking to diversify its revenue sources, but is still very dependent on Bitcoin trading. Despite adding over 600 currency pairs, Bitcoin and Ether dominate the platform’s activity. Adding new assets does not ensure additional revenue from trading fees, and efforts to diversify include non-trading services such as token staking. The company, whose value has increased 101% this year, faces challenges including possible Bitcoin ETFs and SEC lawsuits.

Rite Aid (NYSE:RAD) – Rite Aid, facing financial challenges, is in talks about a possible bankruptcy plan, which could result in the liquidation of several of its drugstores. Around 400 to 500 stores may close, with discussions still ongoing, with no final decisions confirmed.

AstraZeneca (NASDAQ:AZN) – Jefferies upgraded AstraZeneca’s status to “Buy” from “Hold,” noting that R&D assets outside of oncology are being largely overlooked. At the same time, Morgan Stanley mentioned that investors will value the earnings revision narratives at AstraZeneca, Novo Nordisk (NYSE:NVO) and Novartis (NYSE:NVS), with the latter being raised to “Equal Weight” from “Underweight”.

Costco Wholesale (NASDAQ:COST) – Costco has formed a partnership with Sesame, an online healthcare platform, providing members access to medical care at preferred prices. The initiative aligns with the growing trend of retailers such as Walmart and Amazon tapping into the $4.3 trillion healthcare market to expand revenue and deepen customer relationships. This agreement puts Sesame in front of Costco’s 125 million cardholders globally, as Sesame offers more affordable and convenient healthcare visits.

Goodyear Tire & Rubber  (NASDAQ:GT) – Goodyear plans to eliminate 700 jobs and sell 100 stores under a rationalization plan in the Asia-Pacific segment, aiming to improve operating profit by US$50-$55 million by 2025. This restructuring, part of a greater effort, should be completed by the end of 2024.

Nike (NYSE:NKE) – Nike shares fell 1.3% in pre-market trading on Monday after Jefferies downgraded the rating from “Buy” to “Hold”, saying it is likely that the wholesale segment continues to face pressures and that growth in China is dealing with macroeconomic challenges.

Foot Locker (NYSE:FL) – Foot Locker shares experienced a 3% drop in premarket trading Monday after Jefferies downgraded the athletic apparel retailer and Urban Outfitters (NASDAQ:URBN) from “Buy” to “Hold.” This downgrade was based on proprietary research with US consumers, which suggests that paying off student debt will decrease consumer spending.