UKX FTSE 100 Index

MARKET WRAPS

Watch For:

Personal Income & Spending; Durable Goods; University of Michigan Final Consumer Survey; New Home Sales; Canada GDP

Today's Headlines/Must Reads

- A 'Recipe for Disaster': Insiders Warned Meta's Privacy Push Would Shield Child Predators

- Whether in 2000 or 2024, There's No Upside for Supreme Court in Deciding Elections

- This Stat Could Transform How You View Economic Growth

Opening Call:

Stock futures drifted lower, with Nike shares down more than 10% premarket after it cut its revenue outlook.

One last batch of inflation data will test markets before Christmas.

A readout on price pressures, personal spending and incomes is due at 8:30 a.m. ET. Economists expect the report to affirm that inflation retreated last month, even as consumer spending rose.

The PCE data, which includes the Federal Reserve's preferred measure of inflation, could bolster investor hopes that the Fed can guide the economy to a soft landing.

Overseas

New curbs on gaming hammered Chinese tech stocks . Stock in industry heavyweight Tencent, one of the companies hit by the restrictions, crashed 12%, helping pull Hong Kong's Hang Seng Index down 1.7%. European stocks were muted, with the Stoxx Europe 600 little changed.

Stocks to Watch

Nike reported fiscal second-quarter earnings that beat analysts' expectations but announced a $2 billion cost-cutting plan over the next three years as it expects sales to soften in the second half of fiscal 2024. Its shares dropped 11%, with shares of Dick's Sporting Goods and Foot Locker down 4.3% and 6.3%, respectively.

Berkshire Hathaway purchased 5.2 million shares of Occidental Petroleum in recent days, bringing its total ownership in the company to 243.7 million shares, or a 27.7% stake, according to a filing with the SEC. Occidental shares rose 0.9%.

Rocket Lab was up 14% after it said it received a contract from a U.S. government customer worth $515 million to "design, manufacture, deliver, and operate 18 space vehicles. "

Tesla was down 0.4% in premarket trading after RBC Capital reduced its delivery estimates for the electric-vehicle maker in the fourth quarter to 456,000 from 476,000, citing registration data and app downloads.

Bonds:

Reacceleration of inflation and elections in a number of countries, including the U.S., are among the risks that fixed-income markets could face next year , J.P. Morgan Asset Management said.

It added that market pricing interest-rate cuts for March looks premature, nonetheless, investors should consider phases of weakness as a buying opportunity.

Energy:

Oil prices rose, supported by growing fears over trade disruptions due to the situation in the Red Sea and despite a buildup in U.S. oil inventories and rising output.

Metals:

Metals were higher on concerns over supply constraints and a broadly improved market sentiment.

Sucden Financial said seasonal activity is expected to pick up in the new year for copper and support prices above the $8,600 a metric ton level.

Meantime, gold made solid gains on a weaker dollar, weighed by the prospect of Fed interest-rate cuts early next year.

TODAY'S TOP HEADLINES

China's Sportswear Giants Take a $25 Billion Tumble

China's biggest sports brands rode a wave of nationalistic fervor for years, winning over consumers and investors while their Western rivals faltered in the country.

The homegrown giants are now stumbling. They overestimated demand for their footwear and apparel and got caught flat-footed by a broader slowdown in consumer spending.

White House Says $14.1 Billion U.S. Steel Sale Deserves 'Serious Scrutiny'

The Biden administration's top economic adviser said Thursday the $14.1 billion deal to acquire U.S. Steel by Japan's Nippon Steel deserved "serious scrutiny" regarding its potential impact on national security and supply chains.

"This looks like the type of transaction that the interagency committee on foreign investment Congress empowered and the Biden administration strengthened is set up to carefully investigate," said National Economic Adviser Lael Brainard in a statement, referring to Cfius, which reviews certain transactions involving foreign investment in the U.S. "This Administration will be ready to look carefully at the findings of any such investigation and to act if appropriate."

Nike Sends Warning About Slowing Consumer Spending

Nike cut its revenue outlook for the year amid concerns that consumers around the world are becoming more cautious with their spending.

The sneaker and apparel company on Thursday said it anticipates softer sales for the second half of the year. It also plans to shave up to $2 billion in costs over the next three years through streamlining the organization and shedding employees, among other moves. Shares plunged nearly 11% in after-hours trading.

What to Watch in Friday's Spending Report: Inflation Closing In on Fed's Target

Inflation retreated further in November and consumers picked up their spending as moods improved, forecasters said, adding to signs that price pressures can be contained without a recession.

Inflation Outlook Is Clouded by Shipping. Disruptions Hit Everyone From Ikea to BP.

Just as inflation rates appeared to be reliably retreating, a new shock has been increasing uncertainty.

The attacks on container-carrying vessels in the Red Sea and drought in the Panama Canal have cut off two of the world's most important arteries for trade. Ocean freight rates are surging, putting pressure on companies that rely on cheap shipping.

U.K. Economy Shrank in 3Q, as Recession Signals Loom

The U.K.'s economy contracted in the third quarter with a downward revision to the previous quarter indicating that the country could be stuck in a period of subdued economic performance.

U.K. gross domestic product declined 0.1% on quarter in the July-to-September period, according to data from the Office for National Statistics released Friday, lower than the prior figure of flat growth in preliminary data published in November.

The Newest Get Rich Quick Trade: Indian Stocks

India's booming stock market is attracting millions of individual investors hoping to get rich quick.

The benchmark S&P BSE Sensex Index is around 16% higher this year and hit an all-time high this month. The surge encouraged investors to open more than 11 million new accounts with the National Stock Exchange of India in 2023 through the end of August, and has led to record flows into mutual funds that buy stocks. The most popular play: subscribing for shares in new listings, which sometimes surge in value during the first few days of trading.

Emerging Markets Struggled in 2023. Here's Why Next Year May Be Better.

Emerging markets will get a much-needed catalyst for improvement in 2024: central banks around the world pivoting to lower interest rates.

For this year, the MSCI Emerging Markets index is on pace for another trouncing by the S&P 500 index-returning 5% to date, compared with a 26% gain for the S&P. China's sputtering economic recovery and investor apprehension about the country's prospects were a major drag.

Bitcoin Rose on Rumors in 2023. How to Predict What Comes Next.

Bitcoin may be a relatively new technology. It can still follow some pretty old market maxims.

In 2024, FASB to Nudge Forward Projects on Software, Compensation and Green Credits

The Financial Accounting Standards Board has a busy year ahead of it. It will be advancing projects in three tentpole areas-accounting for software costs and environmental credits and greater disclosure of income-statement expenses-aimed at providing investors with new financial insight, Chairman Rich Jones said in an interview.

New rules, which can take years to come to fruition, can also saddle companies with a greater compliance burden. But in outlining his 2024 agenda, Jones said the accounting standard-setter for U.S. companies and nonprofits will again be asking investors and other stakeholders which issues to take up next.

New North Korean Nuclear Reactor Likely Running, U.N. Says

North Korea appears to be operating a more powerful reactor for producing plutonium at its main nuclear site for the first time, the United Nations atomic agency said late Thursday, days after Pyongyang tested an intercontinental ballistic missile that could reach across the U.S.

International Atomic Energy Agency Director General Rafael Grossi said that a light water reactor at North Korea's Yongbyon nuclear facility was discharging warm water, indicating it was reaching criticality, the point at which its nuclear chain reaction becomes self-sustaining. The regime has been building the reactor for years.

Japan to Send U.S. Patriot Missiles, Creating Deeper Pool for Ukraine Air Defenses

TOKYO-Japan said Friday it would provide Patriot missiles to the U.S., bolstering global stocks as Ukraine defends itself from a new wave of Russian missile attacks.

Tokyo is set to transfer dozens of the interceptor missiles, which are used to shoot down ballistic missiles and other aerial threats, from its own supplies, starting as early as the first quarter of 2024, according to a U.S. official.

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

Earnings:

None Scheduled

Economic Calendar [ET]:

0830 Oct GDP

Stocks to Watch:

EnCore Energy CFO Mierkey Has Resigned, Effective Dec 23; Dennis Stover to Act as Interim CFO Until New CFO Found; Stover Is a Director, Was a Former CEO; Search Committee Well Advanced in Efforts to Select New CFO

Gold Fields to Acquire Additional Shares of Galiano Gold Upon Disposal of Interest in Asanko Gold Mine

Royal Bank of Canada Receives Approval To Proceed With Acquisition Of HSBC Canada

Expected Major Events for Friday

00:01/UK: Nov Zoopla House Price Index

00:01/UK: Dec CBI Growth Indicator and Service Sector Survey

00:01/UK: Nov UK monthly automotive manufacturing figures

05:00/JPN: Nov Supermarket sales

07:00/UK: Nov UK monthly retail sales figures

07:00/UK: 3Q Balance of Payments

07:00/UK: 3Q Business investment revised results

07:00/UK: 3Q UK quarterly national accounts

07:00/GER: Nov Foreign trade price indices

07:45/FRA: Nov PPI

07:45/FRA: Dec Consumer confidence survey

08:59/JPN: Oct Final Labour Survey - Earnings, Employment & Hours Worked

09:00/ITA: Dec Consumer Confidence Survey

09:00/ITA: Dec Business Confidence Survey

10:00/ITA: Nov Foreign Trade non-EU

11:00/ITA: Oct Industrial turnover

13:30/US: Nov Personal Income and Outlays

13:30/CAN: Oct GDP

13:30/US: Nov Advance Report on Durable Goods

15:00/US: Nov State Employment and Unemployment

15:00/US: 3Q State Quarterly Personal Income

15:00/US: Dec University of Michigan Survey of Consumers - final

15:00/US: Nov New Residential Sales

15:00/US: 3Q GDP by State

All times in GMT. Powered by Kantar Media and Dow Jones.

Expected Earnings for Friday

Clearday Inc (CLRD) is expected to report for 3Q.

Forward Industries (FORD) is expected to report for 4Q.

SIFCO Industries (SIF) is expected to report for 4Q.

Value Line (VALU) is expected to report for 2Q.

Vyant Bio Inc (VYNT) is expected to report for 3Q.

Powered by Kantar Media and Dow Jones.

ANALYST RATINGS ACTIONS

Amgen Raised to Buy From Neutral by Daiwa Capital

Annexon Raised to Buy From Neutral by B of A Securities

Cava Group Raised to Outperform From Neutral by Wedbush

Cheesecake Factory Raised to Outperform From Neutral by Wedbush

Chipotle Mexican Cut to Neutral From Outperform by Wedbush

Eli Lilly Cut to Outperform From Buy by Daiwa Capital

Extra Space Storage Raised to Equal-Weight From Underweight by Morgan Stanley

Glaukos Raised to Overweight From Neutral by JP Morgan

Highwoods Properties Cut to Underweight From Equal-Weight by Morgan Stanley

Insulet Raised to Outperform From Neutral by Baird

JFrog Raised to Overweight From Equal-Weight by Morgan Stanley

Merit Medical Raised to Buy From Hold by Canaccord Genuity

Nevro Cut to Hold From Buy by Canaccord Genuity

POINT Biopharma Global Cut to Hold From Buy by Brookline Capital

Regency Centers Raised to Overweight From Equal-Weight by Morgan Stanley

Salesforce Raised to Overweight From Equal-Weight by Morgan Stanley

Simon Property Cut to Equal-Weight From Overweight by Morgan Stanley

Urban Edge Properties Raised to Equal-Weight From Underweight by Morgan Stanley

Wendy's Cut to Neutral From Outperform by Wedbush

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

(END) Dow Jones Newswires

December 22, 2023 06:14 ET (11:14 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.