MARKET WRAPS
Watch For:
Trade for November; Canada Trade for November; Earnings from
Albertsons
Today's Top Headlines/Must Reads:
- The former bond king, Bill Gross, says 10-year Treasury is
'overvalued'
- ESG Funds Underperformed in 2023. Backlash Wasn't the
Problem.
- As Retailers Cite Rising Theft and Shrinkage, Analysts Want
More Details
Opening Call:
Stock futures were lower early on Tuesday as a profit warning
from Samsung Electronics weighed on the technology sector.
Samsung said its fourth-quarter operating profit may fall 35% as
weak consumer demand for smartphones hits sales of memory
chips.
Overseas Markets
In Asia, the Nikkei 225 rose 1.2% to close at its best level
since March 1990. In contrast, the Hang Seng initially rose
following indications Beijing may ease monetary policy by cutting
banks reserve requirements, but ended down 0.2% to its lowest since
October 2022 as fears about China's economy lingered.
Premarket Movers
Boeing was down 0.8% in premarket trading after United Airlines
and Alaska Air said they discovered loose parts on Boeing 737 MAX 9
jets.
Match Group was rising 9.8% after the Journal reported Elliott
Investment Management has built a position of roughly $1 billion in
the company.
Nvidia closed Monday at an all-time high, rising 6.4% during the
session. The stock was up 0.2% in premarket trading.
Unity Software said it plans to lay off about 1,800 employees,
or 25% of its workforce, as the company "refocuses on its core
business." Shares rose 3.6%.
Monday's Post-Close Movers
BarkBox parent company Bark said sales for its fiscal third
quarter were better than the dog toy and treat company had
previously forecast. Shares rose 17%.
Extreme Networks lowered its second-quarter revenue outlook.
Shares fell 6.2%.
Hewlett Packard Enterprise is in advanced talks to buy Juniper
Networks for about $13 billion, the Wall Street Journal reported.
HPE shares fell 8.4% in after-market trading, while Juniper shares
rose 21%.
Microchip Technology fell 4.2% after the company said it
expected fiscal third-quarter sales to fall more than it had
anticipated, citing a "weakening economic environment."
Forex:
The dollar's gains at the start of this year have been modest
due to the market's conviction that the Federal Reserve will cut
interest rates this year, ING said.
Increasing long dollar positions is now viewed as a
"counter-trend trade."
January and February are typically good months for the dollar,
but the currency is more likely to trade in a range for now. ING
said the DXY dollar index could trade within a range between 101.90
and 103.10 this week, awaiting Friday's inflation data and bank
earnings.
Bonds:
Weakening growth, slowing inflation and an uncertain political
environment will create the perfect environment for bonds to
outperform other assets in the first quarter of 2024, Saxo
said.
"Bond investors are presented with the opportunity to lock in
one of the highest yields in more than 10 years," it said.
"Higher yields do not only mean higher returns, but also a lower
probability of bonds posting a negative return even if yields rise
slightly again."
Energy:
Oil prices gained, with ING saying that if market weakness
persisted, it would be difficult to see how OPEC+ would be able to
make more meaningful output reductions, given the scale of their
cuts already.
"What we are more likely to see is a rollover of current
voluntary cuts into 2Q24 in order to erode the surplus expected
next quarter."
Metals:
Base metals were weaker, while gold edged higher as market
watchers awaited this week's CPI data for more economic
clarity.
"Investors are awaiting the inflation print on Thursday, which
we expect will bring more volatility to the base metals complex,"
Sucden Financial said.
Uranium
Uranium prices could rise even higher on supply tightness ,
rising demand and thin spot markets, Berenberg said. However,
prices will likely normalize in the $70 per pound range in the long
term.
TODAY'S TOP HEADLINES
PepsiCo, Grocery Giant Bicker Over Who Dumped Whom
A breakup over grocery prices got messier Monday when PepsiCo
said that it, not supermarket chain Carrefour, initiated the
split.
PepsiCo said that it had decided to stop supplying the chain's
European stores because the two sides hadn't reached an agreement
on a new contract.
United, Alaska Find Loose Parts on Some Boeing 737 MAX 9
Jets
United Airlines and Alaska Airlines have discovered loose parts
on Boeing 737 MAX 9 jets that they have inspected after a
near-catastrophe on a flight Friday, signaling Boeing's issues go
beyond the aircraft that made an emergency landing.
The disclosures came shortly before investigators at the
National Transportation Safety Board said that dangerous episode on
an Alaska Airlines jet occurred because an emergency exit-sized
door plug blew out at around 16,000 feet after somehow moving off a
set of stops that are designed to keep it attached to the
plane.
China Surges to the Top of Global Auto Exports
HONG KONG-China's overseas auto sales surged to a record last
year, on track to surpass Japan as the world's biggest exporter and
marking a tectonic shift for the global auto industry.
While China has become acknowledged as a world leader in
electric vehicles, traditional gas-powered autos were the main
driver of the increase, with demand surging especially in
Russia.
Big 2024 Presidential Election Changes Are Leaving Voters
Baffled
Iowa Republicans on Monday will caucus to choose a presidential
candidate, but Democrats will start to vote by mail and wait weeks
for results. In New Hampshire the following week, both parties will
cast primary ballots, but the Democrats' votes will be purely
symbolic.
And then in early February, Nevada Republicans can vote in two
contests: a caucus without all the GOP candidates, and a primary
where results won't count toward the nomination.
Co-Defendant in Trump Georgia Case Alleges Misconduct by Fulton
County Prosecutor Fani Willis
Fulton County District Attorney Fani Willis improperly hired and
paid a private attorney to aid her office in its racketeering case
against former President Donald Trump and others, according to a
court filing Monday by one of the defendants in the case.
A lawyer for Trump co-defendant Mike Roman stated that Willis is
"in a personal, romantic relationship" with Nathan Wade, a special
prosecutor in her office and a lead lawyer on the Trump case. The
motion asked a judge to disqualify Willis from the case she brought
against Trump and other defendants last year. Roman served as the
director of Election Day operations for Trump's 2020 campaign.
Write to ina.kreutz@wsj.com
TODAY IN CANADA
Earnings:
Tilray Brands 2Q
Economic Calendar (ET):
0830 Nov Trade
0830 Nov Building permits
Stocks to Watch:
Eupraxia Pharmaceuticals Announces Filing of Preliminary MJDS
Base Shelf Prospectus
Expected Major Events for Tuesday
00:01/UK: Dec BRC-KPMG Retail Sales Monitor
00:01/UK: CBI Financial Services Survey
00:01/UK: Dec Scottish Retail Sales Monitor
07:00/GER: Nov Industrial Production Index
07:45/FRA: Nov Foreign trade
07:45/FRA: Nov Balance of Payments
09:00/ITA: Nov Unemployment
11:00/US: Dec NFIB Index of Small Business Optimism
13:30/CAN: Nov International merchandise trade
13:30/US: Nov U.S. International Trade in Goods &
Services
13:30/CAN: Nov Building permits
13:55/US: 01/06 Johnson Redbook Retail Sales Index
15:00/US: Jan RCM/TIPP Economic Optimism Index
21:30/US: 01/05 API Weekly Statistical Bulletin
All times in GMT. Powered by Kantar Media and Dow Jones.
Expected Earnings for Tuesday
AZZ Inc (AZZ) is expected to report $0.82 for 3Q.
Acuity Brands (AYI) is expected to report $2.71 for 1Q.
Aehr Test Systems (AEHR) is expected to report for 2Q.
Albertsons Companies Inc (ACI) is expected to report $0.54 for
3Q.
Anixa Biosciences Inc (ANIX) is expected to report for 4Q.
CalAmp (CAMP) is expected to report $-0.15 for 3Q.
Cohbar Inc (CWBR) is expected to report for 3Q.
E2open Parent Holdings Inc (ETWO) is expected to report for
3Q.
MSC Industrial Direct Co Inc (MSM) is expected to report $1.30
for 1Q.
Neogen Corp (NEOG) is expected to report $0.03 for 2Q.
Park Aerospace Corp (PKE) is expected to report for 3Q.
PriceSmart (PSMT) is expected to report $1.09 for 1Q.
SMART Global Holdings Inc (SGH) is expected to report $-0.18 for
1Q.
Saratoga Investment Corp (SAR) is expected to report $1.01 for
3Q.
TD SYNNEX Corp (SNX) is expected to report $2.11 for 4Q.
TSR Inc (TSRI) is expected to report for 2Q.
Tilray Brands Inc (TLRY) is expected to report $-0.05 for
2Q.
VOXX International Corp - Class A (VOXX) is expected to report
$-0.10 for 3Q.
WD 40 (WDFC) is expected to report $1.00 for 1Q.
Powered by Kantar Media and Dow Jones.
ANALYST RATINGS ACTIONS
Advanced Micro Devices Raised to Buy From Hold by Melius
Research
agilon health Cut to Peer Perform From Outperform by Wolfe
Research
American Airlines Group Raised to Overweight From Equal-Weight
by Morgan Stanley
Apple Hospitality REIT Cut to Neutral From Buy by B of A
Securities
Ares Capital Cut to Neutral From Buy by B. Riley Securities
Arista Networks Raised to Buy From Hold by Melius Research
Array Technologies Cut to Equal-Weight From Overweight by Wells
Fargo
Axalta Coating Systems Cut to Neutral From Buy by UBS
Bank OZK Cut to Neutral From Buy by UBS
BankUnited Cut to Sell From Neutral by UBS
Beacon Roofing Supply Raised to Outperform From Market Perform
by William Blair
Blink Charging Raised to Buy From Hold by Needham
Blue Owl Capital Cut to Neutral From Buy by B. Riley
Securities
Brown & Brown Raised to Buy From Neutral by Goldman
Sachs
Brown & Brown Raised to Outperform From Sector Perform by
RBC Capital
Cabot Corp Cut to Neutral From Buy by UBS
Capital One Cut to Neutral From Outperform by Baird
Capital Southwest Cut to Neutral From Buy by B. Riley
Securities
Cboe Global Markets Raised to Overweight From Equal-Weight by
Barclays
ChampionX Cut to Neutral From Overweight by Piper Sandler
Chevron Raised to Buy From Hold by Jefferies
Cisco Systems Cut to Hold From Buy by Melius Research
CME Group Cut to Equal-Weight From Overweight by Barclays
CMS Energy Cut to Neutral From Buy by Seaport Global
Core & Main Raised to Buy From Neutral by Citigroup
CSX Corp Raised to Positive From Neutral by Susquehanna
Deere & Co Cut to Hold From Buy by Melius Research
Dell Technologies Raised to Overweight From Neutral by JP
Morgan
DoorDash Raised to Buy From Hold by Jefferies
DTE Energy Cut to Neutral From Buy by Seaport Global
Eagle Materials Raised to Buy From Hold by Loop Capital
Ecolab Cut to Neutral From Buy by Seaport Global
Enphase Energy Raised to Overweight From Equal-Weight by Wells
Fargo
Equifax Raised to Buy From Underperform by B of A Securities
Exelon Cut to Neutral From Buy by Seaport Global
Fastly Raised to Sector Perform From Underperform by RBC
Capital
FedEx Raised to Buy From Hold by Melius Research
Fidus Investment Cut to Neutral From Buy by B. Riley
Securities
First Solar Cut to Equal-Weight From Overweight by Wells
Fargo
Fiserv Raised to Overweight From Sector Weight by Keybanc
Franklin Resources Raised to Equal-Weight From Underweight by
Wells Fargo
Frontier Group Cut to Equal-Weight From Overweight by Morgan
Stanley
GitLab Raised to Buy From Neutral by Mizuho
Harpoon Therapeutics Cut to Neutral From Buy by HC Wainwright
& Co.
Hartford Financial Cut to Neutral From Overweight by JP
Morgan
Helmerich & Payne Cut to Neutral From Overweight by Piper
Sandler
Horizon Tech Finance Cut to Sell From Neutral by B. Riley
Securities
Host Hotels & Resorts Raised to Buy From Underperform by B
of A Securities
Intercontinental Exchange Raised to Overweight From Equal-Weight
by Barclays
Main Street Capital Cut to Neutral From Buy by B. Riley
Securities
Markel Cut to Sector Perform From Outperform by RBC Capital
MarketAxess Cut to Equal-Weight From Overweight by Barclays
Marsh & McLennan Cut to Sell From Buy by Goldman Sachs
MetLife Raised to Buy From Neutral by Goldman Sachs
Navient Cut to Underperform From Market Perform by TD Cowen
NetApp Cut to Underweight From Neutral by JP Morgan
NEXTracker Raised to Overweight From Equal-Weight by Wells
Fargo
NY Community Bancorp Cut to Neutral From Buy by UBS
Oaktree Specialty Lending Cut to Neutral From Buy by B. Riley
Securities
Okta Cut to Neutral From Buy by Mizuho
Old Dominion Freight Raised to Positive From Neutral by
Susquehanna
PBF Energy Cut to Neutral From Overweight by Piper Sandler
Pebblebrook Hotel Trust Cut to Underperform From Neutral by B of
A Securities
Pool Corp Cut to Hold From Buy by Loop Capital
PulteGroup Cut to Neutral From Buy by Citigroup
Saratoga Investment Cut to Neutral From Buy by B. Riley
Securities
Sherwin-Williams Cut to Neutral From Buy by Seaport Global
SiteOne Landscape Supply Cut to Hold From Buy by Loop
Capital
Southwest Airlines Cut to Underperform From Market Perform by
Bernstein
Stellus Capital Invest Cut to Sell From Neutral by B. Riley
Securities
SunPower Cut to Underweight From Equal-Weight by Wells Fargo
T Rowe Price Cut to Underweight From Equal-Weight by Wells
Fargo
TD SYNNEX Cut to Neutral From Overweight by JP Morgan
Terran Orbital Cut to Neutral From Buy by B. Riley
Securities
Thermo Fisher Cut to Market Perform From Outperform by
Bernstein
Toll Brothers Raised to Outperform From Peer Perform by Wolfe
Research
TopBuild Raised to Buy From Hold by Loop Capital
Upwork Raised to Buy From Hold by Jefferies
Verisk Analytics Cut to Neutral From Buy by B of A
Securities
Voya Financial Cut to Neutral From Buy by Goldman Sachs
Wells Fargo Cut to Neutral From Outperform by Baird
WhiteHorse Finance Cut to Neutral From Buy by B. Riley
Securities
WR Berkley Cut to Sector Perform From Outperform by RBC
Capital
Zions Bancorp Cut to Neutral From Buy by Compass Point
ZoomInfo Technologies Cut to Underperform From Sector Perform by
RBC Capital
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
January 09, 2024 06:08 ET (11:08 GMT)
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