Challenger Job-Cut Report for June; International Trade in Goods
& Services for May; Unemployment Insurance Weekly Claims
Report; EIA Weekly Natural Gas Storage Report; EIA Weekly Petroleum
Status Report; Monthly U.S. Retail Chain Store Sales Index; Federal
Reserve Bank of St. Louis President James Bullard speaks at Little
Rock Regional Chamber; Federal Reserve Board Governor Christopher
Waller speaks at NABE Monetary Policy and Inflation Webinar Series;
Foreign Central Bank Holdings; Federal Discount Window
Stocks futures pointed to modest gains on Thursday as investors
continued to digest the Federal Reserve's minutes from its June
Markets in Europe and Asia mostly rallied, possibly reflecting
the belief that if growth and hiring slow quickly, the Fed won't
need to approve as many interest-rate hikes as traders and the FOMC
expected at the time of last month's meeting.
Thursday morning brings new data on imports, exports and the
trade gap. The trade deficit is expected to be $84.7 billion in
May, according to a survey of 27 economists by The Wall Street
Journal, shrinking slightly from April's deficit of $87.1
Initial unemployment claims for the week ending July 2 also come
out at 8:30 a.m. Economists surveyed by the WSJ expect the labor
market to remain tight, forecasting 230,000 new applications for
unemployment benefits, essentially flat with the prior week's total
It is more imperative than ever to avoid mixing trading and
investment activities, as the risk of confusion is particularly
high in the current circumstances, Julius Baer said.
"The decision criteria, the frequency of decisions and the time
horizon of trading obviously have nothing in common with those of
investing," the bank said.
Julius Baer is of the view that the current decline is more
likely to bottom out in the second half of this year than in 2023.
Risk reduction at this stage is a matter of trading, while those
who want to invest and not to trade, should look beyond the next
few weeks, it said.
The rally in 10-year Treasury yields is a sign investors are
increasingly betting that a slowdown or a recession will push the
Fed to avoid excessive tightening, Yieldstreet said.
With summer ahead, a period usually characterized by lower
liquidity, Yieldstreet expects market volatility to continue.
"The next few inflation readings are likely to be instrumental
to give investors clarity on the potential for stagflation, which
at this point represents a tail risk," it said.
The dollar pulled back ground in Europe after its stellar rise
Swissquote said many market participants think developments
since the Fed's decision last month are so dramatic that the
minutes are no longer relevant while recession fears and morose
market sentiment could prompt the central bank to lift interest
rates 50 basis points at its July 26-27 meeting instead of the 75
bps that is largely priced in.
Sterling was taking political uncertainty in its stride
following reports U.K. Prime Minister Boris Johnson will resign, as
the decision avoids the prospect of a more difficult process to
force him out, said Ebury.
"Markets were already fully expecting him to go, but news of an
imminent resignation, and the avoidance of a likely messy and
potentially ugly removal from office, has given the pound a modest
leg up," said Ebury.
Potential policy implications remain unclear as there is no
clear candidate to replace Johnson. However, any policy changes
will have a limited impact on sterling, which is likely to be
driven by U.K. recession concerns and Bank of England policy.
Oil futures wavered along the flatline in early European action,
with the hawkish Fed minutes not helping the macro mood, according
to Peak Trading Research.
Fitch said prices are likely to remain elevated as supply-side
risks mount, revising its 2022 average Brent price forecast to
$105/bbl from $100/bbl previously.
"Russian exports will come under increasing pressure over the
second half of the year, as the EU approaches its partial import
ban on Russian crude oil, effective December 5," the ratings agency
said. Also, OPEC+ continues to fall far short of its production
targets, and rising political instability in Libya has triggered
renewed production outages, it said.
Spot gold was slightly firmer but UOB said the precious metal
may break below support at $1,720/oz, as its weekly downward
momentum on the technical charts remains strong.
The precious metal has fallen this week and dipped below the
December 2021 low of $1,753/oz on Wednesday.
A break below $1,720/oz would shift the market's focus to the
major, critical support zone of $1,676/oz-$1,684/oz, said UOB,
noting that these levels were tested a few times in March and
August last year.
Base metals rose as Asian buyers looked to secure materials
despite rising Covid-19 cases in Shanghai and macroeconomic
concerns in the U.S. and Europe.
"Onshore [traders] do not seem to be bearish with various
brokers even recommending a buy," Marex said.
"Despite all the negative news such as Shanghai Covid-19 cases
doubling, mass testing in place, and various other cities and
provinces also reporting fresh cases, the market doesn't seem to be
TODAY'S TOP HEADLINES
Merck Is in Advanced Talks to Buy Seagen for Roughly $40 Billion
Merck & Co. is in advanced talks to acquire Seagen Inc. and
is aiming to agree on a purchase of the cancer biotech in the next
few weeks, according to people familiar with the matter, in a deal
that could be worth roughly $40 billion or more.
The companies are discussing a price for Seagen above $200 a
share and are seeking to seal a deal on or before the announcement
of Merck's quarterly earnings, set for July 28, the people said.
Seagen's stock closed at $175.13 on Wednesday.
Shell Upgrades Asset Values on Energy-Price Rise
Shell PLC said Thursday that it would reverse previous
impairments of up to $4.5 billion to its upstream and integrated
gas assets in the second quarter after it raised its energy-prices
The oil major said it had raised its mid- and long-term oil and
gas commodity prices outlook in the second quarter to reflect the
current macroeconomic environment as well as updated energy-market
demand and supply fundamentals.
Samsung Electronics' Run of Record Results Stalls as Global Tech
SEOUL-Samsung Electronics Co.'s string of record results is
expected to end, as the global tech boom slows amid rising
inflation and economic uncertainties.
On Thursday, the South Korean tech giant-which had reported
record revenues in the past three straight quarters-forecast a
11.4% rise in second-quarter operating profit from the prior year.
Revenue for the April-June period is expected to increase
year-over-year by 20.9%.
GameStop Shares Rise After Board Declares 4-for-1 Stock
GameStop Corp. declared a 4-for-1 stock split Wednesday, sending
shares of the videogame retailer higher in after-hours trading.
The Grapevine, Texas-based company proposed a stock split in
March, although it didn't set the split ratio at that time because
it needed shareholders to increase the number of authorized shares.
Shareholders approved the increase last month.
American Airlines to Pay Pilots Triple to Work Flights Dropped
in Computer Glitch
American Airlines Group Inc. will pay pilots triple their normal
wages to work flights that were mistakenly dropped because of a
computer glitch, the union that represents American's pilots
The Allied Pilots Association union said Wednesday that its
board ratified an agreement with the airline that includes the
extra pay for trips affected by an issue with an airline scheduling
platform over the weekend. The system had mistakenly allowed pilots
to drop thousands of future trips early Saturday morning, leaving
as many as 12,075 July flights without a captain or first officer,
or both, the union had said.
J&J Talc Judge Weighs Expert Help to Value Cancer Claims
A bankruptcy judge said he would consider appointing an
independent expert to assist in evaluating the mass claims linking
Johnson & Johnson's talc-based baby powder to cancer.
Judge Michael Kaplan of the U.S. Bankruptcy Court in New Jersey
on Wednesday floated the idea of appointing an outside expert to
help him wade through legal, financial and scientific questions
around allegations that J&J's talc products contained asbestos
and caused ovarian cancer.
TPC Creditors Cerberus, Bayside Lose Debt Priority Dispute
Two creditors of TPC Group Inc. lost a bankruptcy court ruling
on Wednesday, with a judge saying that the chemical business didn't
act improperly when loan documents were amended to change the
pecking order of creditors.
Judge Craig Goldblatt of the U.S. Bankruptcy Court in
Wilmington, Del., said TPC didn't violate the rights of Cerberus
Capital Management LP and Bayside Capital Inc., who combined own
about 10% of TPC's $930 million senior secured notes issued in
Blackstone Invests $400 Million in Environmental Commodity
Blackstone Inc. will invest $400 million in Xpansiv Ltd., a
platform that lets investors trade assets tied to the energy
transition such as carbon offsets and renewable-energy credits,
company officials said.
Xpansiv is an exchange that lets investors swap offsets linked
to green projects such as preserving trees, credits companies
receive for buying clean power and oil and gas contracts that
account for the carbon footprint of fossil fuels. The company's
software provides the underlying project data backing up these
U.K.'s Boris Johnson to Resign After Scandals Grow Too Great to
LONDON-Boris Johnson will resign as British prime minister later
Thursday, officials said, after a full scale mutiny in his party.
Mr. Johnson will remain in office until his replacement is found,
these people said, a process that could take several months. It
caps an astonishing fall from grace for a politician who until
recently looked poised to dominate U.K. politics for years.
Following a string of scandals, two senior ministers and a wave
of more-junior members of government quit over the past week,
saying they no longer had confidence in the British leader. Mr.
Johnson attempted to cling to power amid frenetic plotting by
rebels to unseat him and a push by a group of cabinet members to
have him resign. Until recently he had spoken of his intention to
stay in office until the 2030s. But as his authority withered, and
with the growing threat that the party would change its internal
rules to hold a vote to oust him, he agreed to step aside.
India's Central Bank Takes Steps to Stem Rupee's Slide
India's central bank has relaxed debt-market rules for foreign
portfolio investors and allowed commercial banks to raise interest
rates on nonresidents' foreign-currency deposits in a bid to
support the rupee and boost forex reserves.
"The Reserve Bank [of India] has been closely and continuously
monitoring the liquidity conditions in the forex market and has
stepped in as needed in all its segments to alleviate [U.S.] dollar
tightness with the objective of ensuring orderly market
functioning," it said late Wednesday.
Australia Posts Record Trade Surplus for May
SYDNEY-Australia's seasonally adjusted trade surplus rose to a
record 15.97 billion Australian dollars (US$10.83 billion) in May,
supported by a big jump in the value of exports over the month.
The value of exports jumped 9.5% on month to A$58.40 billion,
driven by higher prices for coal, coke and briquettes, and other
mineral fuels, the Australian Bureau of Statistics said
Uvalde Police Officer Had School Shooter in Sight but Didn't
Shoot, Report Finds
A police officer had the Uvalde school shooter in his rifle
sight before the gunman entered Robb Elementary School but didn't
fire because he believed he needed permission to take the shot, a
The report, released by the Texas State University's Advanced
Law Enforcement Rapid Response Training (ALERRT) Center on
Wednesday, highlighted new details about the troubled response to
the May mass shooting that left 19 children and two teachers
After Highland Park Shooting, Illinois Officials Call for More
Use of Red-Flag Law
Illinois lawmakers are discussing measures to give the state
more authority to stop people who threaten violence from buying
guns after the deadly shooting this week at a July Fourth parade in
Suspected gunman Robert Crimo III, who has been charged with
seven counts of murder, obtained a permit required in Illinois to
buy guns after encounters with police in 2019 in which he attempted
suicide and threatened to kill his family.
Write to email@example.com TODAY IN CANADA
Richelieu Hardware 2Q
Economic Indicators (ET):
0830 May International merchandise trade
1000 Jun Ivey Purchasing Managers Index
Stocks to Watch:
Dye & Durham Makes Revised A$4.70 Per Shr Acquisition
Proposal to Link Group; Dye & Durham: Believes That This Second
Revised Proposal Will Give Greater Certainty to Link Group Hldrs
Regarding Transaction and Will Lead to Its Successful
Advantage Energy: Due to Outperformance at Glacier, Wembley and
Valhalla, 2Q Production Increased to Average Approximately 60,000
Boe/d; Advantage Energy: Lending Syndicate Removes Fixed Limits on
Shr Buybacks and Replaces Them With a Liquidity-Based Limit
Lundin Gold Reports 2Q Gold Production of 111,890 Ounces, Is on
Track to Meet 2022 Guidance
Expected Major Events for Thursday
05:00/JPN: May Indexes of Business Conditions - Preliminary
06:00/GER: May Industrial Production Index
06:00/UK: 2Q Halifax House Price Index: UK Regional Breakdown
06:00/UK: Jun Halifax House Price Index
11:30/US: Jun Challenger Job-Cut Report
12:15/US: Jun CANCELLED: ADP National Employment Report
12:30/CAN: May International merchandise trade
12:30/US: May U.S. International Trade in Goods &
12:30/US: 07/02 Unemployment Insurance Weekly Claims Report -
13:00/RUS: Weekly International Reserves
14:00/CAN: Jun Ivey Purchasing Managers Index
14:30/US: 07/01 EIA Weekly Natural Gas Storage Report
15:00/US: 07/01 EIA Weekly Petroleum Status Report
16:00/US: Jun Monthly U.S. Retail Chain Store Sales Index
20:30/US: Foreign Central Bank Holdings
20:30/US: Federal Discount Window Borrowings
23:01/UK: Jun BRC-Sensormatic IQ Footfall Monitor
23:30/JPN: May Household Spending
23:50/JPN: Jun Bank Lending
23:50/JPN: Jun International Transactions in Securities
23:50/JPN: 1Q Revised Balance of Payments
23:50/JPN: May Balance of Payments
All times in GMT. Powered by Onclusive and Dow Jones.
Expected Earnings for Thursday
Aritzia Inc (ATZ.T) is expected to report $0.28 for 1Q.
Bank Of South Carolina (BKSC) is expected to report for 2Q.
Buckle Inc (BKE) is expected to report.
Byrna Technologies Inc (BYRN,BYRN-L) is expected to report for
Caldwell Partners International Inc (CWL.T) is expected to
report for 3Q.
Capstone Green Energy Corp (CGRN) is expected to report for
Costco Wholesale Corp (COST) is expected to report.
Goodfellow (GDL.T) is expected to report for 2Q.
Kayne Anderson Energy Infrastructure Fund Inc (KYN) is expected
to report for Full year.
Kura Sushi USA Inc (KRUS) is expected to report for 3Q.
Levi Strauss & Co (LEVI) is expected to report $0.23 for
National Energy Services Reunited Corp (NESR) is expected to
report $0.11 for 1Q.
Nautilus (NLS) is expected to report $-0.72 for 1Q.
Park Aerospace Corp (PKE) is expected to report for 1Q.
Postmedia Network Canada (PNC.A.T,PNC.B.T) is expected to report
Richelieu Hardware (RCH.T) is expected to report $0.71 for
Singularity Future Technology Ltd (SGLY) is expected to report
Tilray Inc (TLRY) is expected to report $-0.08 for 4Q.
Universal Security Instruments Inc (UUU) is expected to report
Velan Inc (VLN.T,VLNSF) is expected to report for 1Q.
WD 40 (WDFC) is expected to report $1.30 for 3Q.
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ANALYST RATINGS ACTIONS
D&B Raised to Neutral From Underperform by B of A
Enanta Pharmaceuticals Raised to Outperform From In-Line by
Evercore ISI Group
Evolution Petroleum Cut to Neutral From Buy by Roth Capital
Harpoon Therapeutics Coverage Assumed by Canaccord Genuity at
HCA Healthcare Cut to Underperform From Market Perform by BMO
Investor Concerns Over Buyout Prices Reflected in Stock Trading
Neoleukin Therapeutics Coverage Assumed by Canaccord Genuity at
Olema Pharmaceuticals Coverage Assumed by Canaccord Genuity at
Rocket Cos. Raised to Overweight From Equal-Weight by Wells
Xencor Coverage Assumed by Canaccord Genuity at Buy
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
July 07, 2022 05:39 ET (09:39 GMT)
Copyright (c) 2022 Dow Jones & Company, Inc.