Personal Income & Outlays for October; Weekly Jobless
Claims; ISM Report on Business Manufacturing PMI; earnings from
Toronto-Dominion Bank, Bank of Montreal
Today's Headlines/Must Reads
- Spending Report to Offer Clues About Consumers' Strength This
- Rising Tether Loans Add Risk to Stablecoin, Crypto World
- Collapse of FTX Draws Senate Hearing Scrutiny
- Netflix to Let Tens of Thousands of Subscribers Preview
- Tesla to Recall About 435,000 Cars in China
- Telegram to Build Decentralized Crypto Exchanges, CEO Says
Follow WSJ markets coverage here .
Equity futures were a bit softer on Thursday, as investors
paused to reflect after a less-hawkish Jerome Powell delivered a
strong end to November, with the market awaiting more important
economic data over the next few days.
"With markets increasingly predisposed to a terminal rate below
5% and inflation getting back close to target in 2024, the stock
market's rally could extend as pivot hopes should increase with
interest rate risk now disproportionately skewed to the downside,"
SPI Asset Management said.
However, investors will be aware that the Fed's policy
trajectory remains dependent on data showing inflation continuing
to slow as the economy cools. To that end traders will be keenly
eyeing a batch of important data over the next two sessions.
Two reports in particular may hold great sway: the October PCE
price index, among the Fed's favored inflation gauges, is released
on Thursday at 8:30 a.m.; and the nonfarm payrolls survey will be
published on Friday at the same time.
Meanwhile, Fundstrat warned that the stock market may experience
a pause for a while following recent gains.
"Wednesday's strong 'whoosh' higher for equities and Treasuries
has lifted prices along with yields to levels that are near
technical targets for a possible trend reversal next week."
Global stocks rose: The Stoxx Europe 600 was up 0.8%, while Hong
Kong's Hang Seng added 0.7% and Japan's Nikkei gained 0.9%.
Stocks to Watch
Costco: Shares fell 2.9% off hours after it said the pace of
monthly sales had slowed in November from the prior month.
Okta: Guided for profitability for all of its next fiscal year.
On the earnings conference call, Okta's CFO projected adjusted
profits for the full year on revenue of $2.13-$2.15 billion.
Analysts expected adjusted losses of 30 cents a share on sales of
$2.3 billion. Okta shares rose 15% in after hours trading.
Orthofix Medical: Said it received an unsolicited $23-a-share
takeover offer from two private equity firms but said it would
stick with its current deal to acquire SeaSpine Holdings Corp. in a
$285 million stock swap because it's "unable to conclude" the
latest offer is superior. Orthofix shares gained 11% after the
Salesforce: Posted higher revenue in the latest quarter and said
co-CEO Bret Taylor is leaving a year after he was elevated to run
the business-software provider alongside Chairman Marc Benioff.
Salesforce shares dropped 6.9% off hours.
Snowflake: Reported quarterly revenue that topped expectations
but came up shy with its fourth-quarter sales outlook. Its shares
dropped 5.6% off hours.
Splunk: Boosted its full-year outlook for sales and cash flow,
following third-quarter results that beat expectations. The stock
rose 9% in the after-hours session.
Sturm, Ruger & Co: Declared a special dividend of $5 a share
payable on Jan. 5 and cited a current cash balance of $220 million.
Shares rose 6% after hours.
Victoria's Secret: Forecast declines in fourth-quarter sales and
profit that were below analysts' expectations, with management
saying they expected the pain customers have felt from higher
prices to continue for the rest of the year. The company's third
quarter also suffered from weaker-than-expected sales trends.
Shares fell 1.1% after hours.
The dollar's falls since Powell signaled the pace of rate
increases may slow in December could be an overreaction and the DXY
dollar index is likely to stay above 105.00, ING said.
"His [Powell's] core message was one of stubbornly high core
inflation. We continue to take the view that a trade-weighted
measure like DXY can hold support levels around the 105 area [or at
least will not sustain any break under it.]"
Focus now will center on today's core PCE data and Friday's
monthly jobs data, ING said.
Sterling hit a one-week high against a weaker dollar and the
gains could extend further depending on upcoming U.S. data, ING
The rally in GBP/USD could extend to the 1.22-1.23 area unless
the core personal consumption expenditure price index data or the
nonfarm payrolls report on Friday "can put a floor back under U.S.
yields," ING said.
Crude oil futures inched lower in European trading, with prices
giving back some of the sharp post-Powell gains on Wednesday.
Copper prices eased lower in London, while the rest of the base
metals complex and gold gained, as investors weighed China's
possible reopening and the Fed's signal on monetary policy.
TODAY'S TOP HEADLINES
Netflix to Let Tens of Thousands of Subscribers Preview
Before Netflix Inc.'s 2021 release of "Don't Look Up," a small
group of its U.S. subscribers previewed the film and told the
streaming giant that the movie came across as too serious,
according to people familiar with the matter.
The film's creators used that feedback to dial up the comedic
element of the film and make it appeal to a broader audience, the
people said. While the film received lukewarm reviews among
critics, "Don't Look Up" was nominated for four Academy Awards and
broke a Netflix record for weekly viewing hours of a film, a record
it still holds.
Timberland Manager Manulife Moving Into Forest Carbon-Offset
One of the country's largest timberland owners is branching out
into forest-offset markets, raising a pool of cash to buy
properties where sequestering the carbon in standing trees will be
prioritized over cutting them down to make wood products.
Manulife Investment Management, which manages on behalf of big
investors about 6 million acres of timberland in the Americas and
Oceania, said it is aiming to raise a $500 million fund with cash
from its parent company, Toronto insurance and financial-services
firm Manulife Financial Corp., and other institutional
Tesla to Recall About 435,000 Cars in China
Tesla Inc. is recalling more than 435,000 cars in China, days
after the electric-car maker recalled about 80,000 vehicles in the
world's largest auto market.
The company has filed a plan with China's State Administration
for Market Regulation to recall 142,277 domestically made Model 3
cars and 292,855 domestically made Model Y cars, the top market
watchdog said Thursday.
Naloxone Startup Pursues FDA Approval for Over-the-Counter
A startup vying to produce one of the first over-the-counter
overdose-reversal medications said it had submitted results to the
Food and Drug Administration showing that its drug works more
quickly than prescription-only versions.
The randomized trial of 60 healthy volunteers evaluated naloxone
absorption from Pocket Naloxone Corp.'s nasal swab versus a 4
milligram nasal-spray delivery and found 74% higher exposure 2.5
minutes after dosing and 19% higher exposure at 5 minutes. Naloxone
works by blocking the effects of opioids.
General Electric Sets Healthcare Division Spinoff Plans
General Electric Co. set the terms for the spinoff of its
healthcare division, putting an initial value of roughly $31
billion on the soon-to-be-public company.
GE said current shareholders would get one share in the new GE
HealthCare Technologies Inc. for every three shares they hold in
GE. The separation is set for Jan. 3 after the markets close, and
the new shares will trade on Nasdaq under the symbol GEHC.
Mark Zuckerberg Says Apple Holds Too Much Control Over App
Meta Platforms Inc. CEO Mark Zuckerberg said Apple Inc. holds
too much sway over the mobile-app ecosystem and that he is still
optimistic about his company's metaverse ambitions, even if they
might not come to fruition for many years.
"Apple has sort of singled themselves out as the only company
that is trying to control, like unilaterally, what apps get on a
device," the chief executive said Wednesday at the New York Times'
Dealbook Summit in New York City. "I don't think that's a
sustainable or good place to be."
TikTok Chief Touts Customer Data-Privacy Initiatives
TikTok Chief Executive Shou Chew said the video-sharing platform
is taking greater steps to keep user data secure and that it needs
to invest more in protecting young people from getting exposed to
"We have very rigorous data-access protocols," he said at the
New York Times's Dealbook Summit in New York on Wednesday, adding
that TikTok, a unit of Beijing-based ByteDance Ltd., chose Oracle
Corp. as its cloud-infrastructure provider because the company has
strong security controls.
Starwood-Backed Reverse Mortgage Originator Files for
Reverse Mortgage Investment Trust Inc., one of the nation's
largest mortgage lenders that enables people to tap the equity
built up in their homes, has filed for chapter 11 bankruptcy
The Bloomfield, N.J.-based company partly attributed rising
interest rates to the disruption of its business. Reverse Mortgage
said it faced a liquidity crunch and stopped mortgage origination
in early November as it had to increase the capital to support the
origination of new loans and to service portfolios. Reverse
mortgages are typically made to seniors looking to tap the value
built up in their homes.
Sam Bankman-Fried Denies Knowing Scale of Bad Alameda Bets
Sam Bankman-Fried said that he didn't intend to commit any fraud
or use customer funds to back leveraged bets that went wrong at
Alameda Research, a cryptocurrency hedge fund attached to FTX that
pushed the exchange to bankruptcy.
Mr. Bankman-Fried, speaking at the New York Times DealBook
Summit in New York, denied knowingly commingling customer funds to
back his crypto trading operation and tried to deflect some of the
blame for FTX's collapse away from himself, saying he was surprised
at the size of Alameda's bets that went wrong.
Spending Report to Offer Clues About Consumers' Strength This
An October household spending report will show how consumers
fared as the holiday season approached, with high inflation and
rising interest rates weighing on the economy.
The Commerce Department will release spending, income and
inflation figures at 8:30 a.m. Eastern time on Thursday. The report
will offer a broad picture of consumer health, with spending trends
on services such as travel, housing and utilities.
Some Retailers Are Learning to Love Bulked-Up Inventories
While many retailers are discounting, canceling orders and
otherwise scrambling to get rid of a glut of goods filling their
stores and warehouses, some are embracing their higher inventory
Merchants including Dick's Sporting Goods Inc., Lowe's Cos. and
Walmart Inc. say the rising stocks signal a recovery from last
year's shortages driven by supply-chain disruptions and put them in
a strong position to take advantage of consumer demand this holiday
Rising Tether Loans Add Risk to Stablecoin, Crypto World
The company behind the tether stablecoin has increasingly been
lending its own coins to customers rather than selling them for
hard currency upfront. The shift adds to risks that the company may
not have enough liquid assets to pay redemptions in a crisis.
Tether Holdings Ltd. says it lends only to eligible customers
and requires that borrowers post lots of "extremely liquid"
collateral, which could be sold for dollars if borrowers
China Caixin Manufacturing PMI Marks Fourth Straight Month of
A private gauge of activity in China's manufacturing sector
remained in contractionary territory for a fourth straight month in
November, as the government's stringent Covid restrictions
continued to weigh on both output and demand.
The China Caixin manufacturing purchasing managers index
slightly improved to 49.4 in November from 49.2 in October,
according to data released Thursday by Caixin Media Co. and S&P
FTX Collapse Draws Senate Hearing Scrutiny as Crypto Oversight
WASHINGTON-Senators with a plan to regulate cryptocurrencies are
due to question the Commodity Futures Trading Commission's chairman
about the failure of the digital-asset exchange FTX and on
legislation that would give that agency more power over the
CFTC Chairman Rostin Behnam is scheduled to testify at
Thursday's hearing of the Senate Agriculture Committee. The panel's
chairwoman, Sen. Debbie Stabenow (D., Mich.), and its ranking
member, Sen. John Boozman (R., Ark.), introduced a bill that would
regulate trading in bitcoin, ether and some other cryptocurrencies
through the commission. Giving the CFTC, a relatively small agency,
authority to police trading in the most valuable crypto assets
would mark a substantial expansion of its authority.
Democrats to Reshape Presidential Primary Calendar as Joe Biden
Mulls 2024 Bid
WASHINGTON-Democratic National Committee members are struggling
to reach consensus on what would be the first major change since
2006 in the party's early-state lineup for presidential primaries,
as they await input from the White House.
The national party organization's Rules and Bylaws Committee is
set to meet in Washington over two days starting Friday to try to
approve a slate of early contests that would offer greater
diversity and union representation. The effort has echoes from 16
years ago, when Nevada and South Carolina were selected to join
Iowa and New Hampshire to open the 2008 nomination race. The full
DNC is expected to ratify changes early next year.
House Approves Imposing Railroad Labor Deal, Paid Sick Leave
The House approved a measure Wednesday to end a long-running
railroad labor dispute while also backing a proposal to impose
seven days of paid sick leave, as President Biden urged lawmakers
to work quickly to head off a possible strike.
House lawmakers voted 290 to 137 on legislation that would force
the adoption of a tentative labor agreement by rail workers, using
the power of a 1926 law that allows Congress to intervene in
railroad disputes that threaten to disrupt the U.S. economy. On
paid leave, lawmakers voted 221-207 to approve the proposal, with
Democrats in favor and almost all Republicans opposed.
Write to email@example.com TODAY IN CANADA
Bank of Montreal 4Q
Canadn Imperial Bank 4Q
Toronto-Dominion Bank 4Q
Economic Indicators (ET):
0830 3Q Labour productivity, hourly compensation & unit
0930 Nov Canada Manufacturing PMI
Stocks to Watch:
Birks Group Mid-Yr Fiscal 2023 Comparable Store Sales Increased
Interfor Completes Acquisition Of Chaleur Forest Products;
Prices $200M in Long-Term Debt Financing With Prudential Private
Expected Major Events for Thursday
00:30/JPN: Nov Japan Manufacturing PMI
05:00/JPN: Nov Auto sales
05:00/JPN: Nov Consumer Confidence Survey
06:00/RUS: Nov Russian Manufacturing PMI
07:00/GER: Oct Retail Trade
07:00/UK: Nov Nationwide House Price Index
08:45/ITA: Nov Italy Manufacturing PMI
08:50/FRA: Nov France Manufacturing PMI
08:55/GER: Nov Germany Manufacturing PMI
09:00/ITA: Oct Unemployment
09:30/UK: Nov S&P Global / CIPS UK Manufacturing PMI
12:30/US: Nov Challenger Job-Cut Report
13:00/RUS: Weekly International Reserves
13:30/US: Oct Personal Income & Outlays
13:30/US: 11/26 Unemployment Insurance Weekly Claims Report -
13:30/US: U.S. Weekly Export Sales
13:30/CAN: 3Q Labour productivity, hourly compensation &
unit labour cost
14:30/CAN: Nov Canada Manufacturing PMI
14:45/US: Nov US Manufacturing PMI
15:00/US: Nov ISM Report On Business Manufacturing PMI
15:00/US: Oct Construction Spending - Construction Put in
15:00/US: Oct Metropolitan Area Employment &
15:30/US: 11/25 EIA Weekly Natural Gas Storage Report
16:00/US: Nov Global Manufacturing PMI
17:00/US: Nov Monthly U.S. Retail Chain Store Sales Index
21:00/US: Nov Domestic Auto Industry Sales
21:30/US: Foreign Central Bank Holdings
21:30/US: Federal Discount Window Borrowings
23:50/JPN: Nov Monetary Base
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Expected Earnings for Thursday
Ambarella Inc (AMBA) is expected to report $-0.47 for 3Q.
American Outdoor Brands Inc (AOUT) is expected to report for
Asana Inc (ASAN) is expected to report for 3Q.
Bank of Montreal (BMO,BMO.T) is expected to report $3.08 for
Big Lots (BIG) is expected to report $-2.90 for 3Q.
Buckle Inc (BKE) is expected to report.
Canadian Imperial Bank of Commerce (CM,CM.T) is expected to
report $1.73 for 4Q.
ChargePoint Holdings Inc (CHPT) is expected to report for
ClearSign Technologies Corp (CLIR) is expected to report for
Designer Brands Inc (DBI) is expected to report for 3Q.
Dollar General (DG) is expected to report $2.54 for 3Q.
Duluth Holdings Inc (DLTH) is expected to report $-0.03 for
FP Newspapers (FP.V) is expected to report for 3Q.
G-III Apparel (GIII) is expected to report $1.81 for 3Q.
Inspirato Inc (ISPO) is expected to report for 3Q.
JOANN Inc (JOAN) is expected to report for 3Q.
Kroger Co (KR) is expected to report $0.84 for 3Q.
Lands' End Inc (LE) is expected to report for 3Q.
Methode Electronics (MEI) is expected to report $0.64 for
PagerDuty Inc (PD) is expected to report for 3Q.
Patterson Companies (PDCO) is expected to report $0.49 for
Provident Bancorp Inc (PVBC) is expected to report for 3Q.
Rex American (REX) is expected to report for 3Q.
Samsara Inc (IOT) is expected to report for 3Q.
SecureWorks Corp (SCWX) is expected to report $-0.37 for 3Q.
Smartsheet Inc (SMAR) is expected to report $-0.53 for 3Q.
Tilly's (TLYS) is expected to report $0.07 for 3Q.
Toronto-Dominion Bank (TD,TD.T) is expected to report $2.08 for
UiPath Inc (PATH) is expected to report for 3Q.
Ulta Beauty Inc (ULTA) is expected to report $4.20 for 3Q.
Veeva Systems (VEEV) is expected to report $0.68 for 3Q.
Zscaler Inc (ZS) is expected to report $-0.57 for 1Q.
Zumiez (ZUMZ) is expected to report $0.18 for 3Q.
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ANALYST RATINGS ACTIONS
American Homes 4 Rent Cut to Peer Perform From Outperform by
Antero Resources Cut to Hold From Buy by Tudor Pickering
Apollo Endosurgery Cut to Hold From Buy by Lake Street
Carvana Cut to Neutral From Buy by B of A Securities
Consolidated Edison Raised to Neutral From Underperform by B of
Cooper Cos Raised to Outperform From Neutral by Baird
Coterra Energy Cut to Hold From Buy by Tudor Pickering
CrowdStrike Holdings Cut to Hold From Buy by Stifel
EQT Corp Cut to Hold From Buy by Tudor Pickering
Invitation Homes Cut to Peer Perform From Outperform by Wolfe
LPL Financial Holdings Cut to Equal-Weight From Overweight by
MillerKnoll Cut to Hold From Buy by Benchmark
PennyMac Mtg Invt Tr Cut to Hold From Buy by JonesTrading
Solid Power Cut to Neutral From Buy by DA Davidson
SoundHound AI Raised to Overweight From Neutral by Cantor
Southwest Gas Cut to Neutral From Buy by B of A Securities
Steelcase Cut to Hold From Buy by Benchmark
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
December 01, 2022 06:13 ET (11:13 GMT)
Copyright (c) 2022 Dow Jones & Company, Inc.