Constructive data set 2023 off on a positive note

TradeTheNews.com Weekly Market Update: Constructive data set 2023 off on a positive note

1/6/2023 4:06:11 PM

Investors opened 2023 with a lot of economic data and Federal Reserve speak to sift through as many returned from a long holiday break. It started with encouraging signals that European CPI has peaked. Softer than expected headline readings in Germany and France were echoed across the rest of the continent, though officials were quick to point out core inflation remained too sticky. Those headlines were somewhat offset by stubbornly strong US employment readings including JOLTS, jobless claims, and the December ADP employment report. Large cap US tech stocks remained decidedly weak while it was clear investors were bargain hunting in other areas of equities, including overseas, following the heavy selling seen through much of 2022. Rates started to drift higher amid a steady drumbeat of hawkish rhetoric from central banks, in particular from the US Fed. Heading into Friday’s session, the US 2-yield was nearing 4.5%, the spread between the 3-month T-bill and 10-year crossed below -90 basis points for the first time in more than 20-years, and futures markets were once again projecting the Fed funds rate to move above 5% for the first time in weeks. The S&P tested support at 3,800 on several occasions but was holding.

The anxiety heading into the December jobs report abated quickly when the data was released Friday morning. Investors looked past a surprise drop in the unemployment rate to 3.5%, hoping the Fed will choose to focus on signs of cooling wage growth and a welcomed rise in the labor force participation rate. Stocks prices rose and bond yields slumped led by declines at the short end of the Treasury curve. After the opening bell large cap tech saw early selling pressures yet again, briefly dipping the NASDAQ into the red before a very soft December ISM services print pushed stock indices to new highs on the week. The US 2-year yield dropped more than 20 bps from pre-release levels while the curve saw modest steepening. The US dollar relinquished early gains and moved lower while gold prices neared a 6-month high above $1,865. US natural gas futures extended losses to the lowest level in last 18 months. Stocks continued to climb through Friday's session despite additional hawkish pushback from Fed officials. Atlanta Fed President Bostic noted that the Dec jobs report did not change his outlook, and that he still expects rates to move above 5% and hold there well into 2024. For the week, the S&P gained 1.4%, the DJIA was up 1.5%, and the Nasdaq rose 1%.

In corporate news this week, layoffs continued in big tech as Amazon reportedly planned to let go even more workers than previously expected. Tesla had another rough ride as Q4 deliveries came in below expectations and the company implemented price cuts across China, Japan and Korea. Southwest confirmed cuts to its guidance based on its December weather-related cancellations, but shares managed to rally after the mea culpa. Investors bought Costco shares in bulk after the big box retailer reported solid same store sales growth in December, improving over the results seen in the prior two months. The FDA granted accelerated approval for the new Alzheimer’s disease treatment Leqembi from Eisai, and its partner Biogen saw share price gains. In M&A news, reports said that Western Digital has revived takeover talks with Japan’s Kioxia, a potential deal that could lead to an entity controlling a third of the NAND market.

BOJ surprise headlines choppy pre-holiday week of trade

TradeTheNews.com Weekly Market Update: BOJ surprise headlines choppy pre-holiday week of trade

12/23/2022 4:13:49 PM

US equity markets limped into this week as investors tried to reconcile the hawkish rhetoric coming from global central bankers against a clearly weakening economy and slowing inflation. Tuesday the BOJ further jolted investors by widening the tolerance range for their 10-year JGB yield control parameters. Some viewed it as a seminal change in BOJ policy acknowledging the time has come to start tightening alongside the rest of the world’s central banks despite BOJ policy makers' insistence the move should only be seen as policy tweak intended to improve market functioning. Nevertheless, global bond yields started to back up and equity trade remained very choppy post BOJ. Investors responded positively to Nike and FedEx quarterly results, albeit measured against a clearly lowered bar. The NASDAQ saw bouts of heavy selling pressure as it has throughout 2022 headlined by the once darling, megacap tech sector. Tesla shares were the poster child falling precipitously to levels not seen since the summer of 2020 despite CEO Musk reiterating his intention to step down from the role of Twitter CEO, and claiming he will not sell anymore Tesla shares until 2025. Another disappointing earnings report from Micron added to the sectors woes with chip stocks falling some 6% on Thursday alone.

Thursday’s session was particularly vicious after Appaloosa's David Tepper offered a restrained view heading into 2023 noting he is taking central bankers at their word and would expect a lot more tightening next year, and for that reason is leaning short both stocks and bonds. The Fed had a lot of economic data to sift through offering an array of signals as the week progressed. Final Q2 GDP and PCE numbers were unexpectedly revised higher. December consumer confidence surprised on the upside hitting a fresh 8-month high, helped by a significant drop in inflation expectations. Nov core PCE continued to moderate but slightly topped expectations while weekly jobless claims remained stubbornly low. Nov leading indicators slumped again with only stock prices contributing positively to the data series. Stock prices rebounded late in Thursday’s session allowing the S&P to hold the 3800 support level heading into the long holiday weekend. For the week the S&P fell 0.2%, the Dow rose 0.9% and the NASDAQ lost ~2%.

Crude oil prices climbed throughout the week while natural gas prices plunged. President Putin and his cronies continued to suggest they may slash oil production in response to the EU oil price cap. European gas futures saw extended losses falling below €85/MWh for the first time since February as forecasts turned more mild for the first part of January. US natural gas prices tested the lows all the way back to the fall of 2021, after Freeport LNG once again delayed the initial restart of its liquefaction facility until the second half of January. The US energy complex climbed throughout Friday’s session as winter storm Elliot wreaked havoc along the Gulf Coast freezing in a swath of refining facilities. The US dollar finished the week about 8% off the November highs, but still up roughly 9% from where it entered 2022.

Consternation rises as Fed and ECB hawkishness intensifies into a potentially stalling economy

TradeTheNews.com Weekly Market Update: Consternation rises as Fed and ECB hawkishness intensifies into a potentially stalling economy

12/16/2022 4:04:34 PM

Trading opened this week on an opportunistic note. Several decent sized M&A announcements kindled modest animal spirits for stocks initially. Momentum carried over into Tuesday’s CPI release. Nov headline and core CPI both came in below market expectations. The deceleration seen was broad with a wide variety of categories coming in below expectations, while there were only a few offsetting surprises on the high side. Hopes were on the rise that the report potentially reduced the risk that the Fed might have to push the funds rate above 5% next year. Those hopes were squashed though, on Wednesday when the Fed hiked by 50 basis points as expected, but more importantly offered decidedly more hawkish SEP projections than markets had been expecting. The median forecast for the 2023 fed funds rate climbed above 5.1%. Indices quickly moved into the red and rates backed up, but only marginally. During his press conference Chairman Powell acknowledged that the last two CPI reports showed "a welcome reduction in the monthly pace of price increases," but also added "it will take substantially more evidence to have confidence that inflation is on a sustained downward path." Markets tried to take solace in Powell noting that policy is getting close to sufficiently restrictive, but ultimately couldn't overcome the Chairman's hawkish tone. Worries about a potential policy error swelled as a debate raged whether the Fed was once again behind the inflation (deflation) curve. Longer dated US yields unexpectedly fell, further inverting the curve while the 2-year yield stayed below the current Fed funds rate.

The post Fed stock slump picked up significant momentum Thursday after the ECB doubled down on its own hawkish commentary and US economic data revealed a worsening landscape. ECB Chief Lagarde signaled that markets should expect multiple 50 basis point hikes in the months ahead in what was reported to be an olive branch to a majority of ECB officials who wanted to hike by 75 basis points. Hopes for a soft landing took a hard hit after Nov retail sales and manufacturing data missed estimates and included deterioration in many of the key components like new orders, while weekly jobless claims stubbornly fell. The selling pressure got worse after the S&P was unable to hold key support around 3900. Equity markets stayed heavy heading into Friday’s quadruple witching options expiration. S&P Global PMI readings were below expectations confirming the softness seen across much of the US economic data earlier in the week. Concerns swirled about what is potentially setting up to be a difficult environment in 2023, whether it is outright recession or maybe even worse, extended stagflation. Multiple ECB officials hammered home Lagarde’s message, that is to say rates are going up more than markets had been anticipating. European bond yields continued to back up pulling UST yields higher while oil prices slumped. For the week the S&P fell 2%, Dow lost 1.7% and NASDAQ declined 2.7%.

SUN 12/11
(UR) Pentagon reportedly has given a 'tacit endorsement' of Ukraine’s long-range attacks on military targets inside Russia after massive missile strikes against Ukraine's critical infrastructure - UK press
(JP) Japan Nov PPI (CGPI) M/M: 0.6% v 0.5%e; Y/Y: 9.3% v 8.9%e

MON 12/12
(CN) China to remove its official movement-tracking app, "Travel Card", used to help limit spread of COVID, from Dec 13th - Chinese press
(UK) OCT MONTHLY GDP M/M: 0.5% V 0.4%E
(UK) OCT INDUSTRIAL PRODUCTION M/M: 0.0% V 0.0%E; Y/Y: -2.4% V -2.5%E
(CN) Beijing official: To distribute more COVID antigen tests and medicine; To open more fever clinics; Drug supplies under strainUS Dept of Energy said to announce Dec 13th that California scientists have been able for the 1st time to produce a fusion reaction that creates a net energy gain; Scientists reportedly were able to create abundant limitless, zero-carbon power through nuclear fusion - WaPo
HZNP Confirms to be acquired by Amgen for $116.50/shr in cash valued at $27.8B
BINANCE.IPO (US) US prosecutors reportedly consider charging Binance and executives for possible money laundering and sanctions violations; Discussed possible plea deals - press
ORCL Reports Q2 $1.21 v $1.17e, Rev $12.3B v $12.0Be

TUES 12/13
(CN) China reportedly to be rolling out >CNY1.0T (~$143B) in support for domestic semiconductor industry during Q1 2023 - press
(DE) GERMANY NOV FINAL CPI M/M: -0.5% V -0.5%E; Y/Y: 10.0% V 10.0%E
(CN) China NHC official: The number of fever outpatient visits and flu-like cases rose significantly, and the number of 120 emergency hotline calls increased sharply
(EU) EU said to have reached a political deal to impose a carbon dioxide emissions tariff on imports of polluting goods such as iron, steel, cement, fertilizers, aluminum and electricity - press
(RU) RUSSIA SAID TO HAVE AGREED THE DRAFT DECREE FOR RESPONSE TO WEST'S PRICE CAP; TO BAN OIL SUPPLIES TO COUNTRIES WHICH JOINED RUSSIAN OIL PRICE CAP MECHANISM (AS EXPECTED) - RUSSIAN PRESS
(CN) China said to delay major economic policy meeting due to COVID cases surge in Beijing - press
(DE) GERMANY DEC ZEW CURRENT SITUATION SURVEY: -61.4 V -57.0E; EXPECTATIONS SURVEY: -23.3 V -26.4E
UAL Confirms order for 100 Boeing 787 Dreamliners with options to purchase 100 more (largest widebody order by a US carrier in commercial aviation history)
MRNA Moderna and Merck announce mRNA-4157/V940, an investigational personalized mRNA cancer vaccine, in combination with KEYTRUDA (pembrolizumab), met primary efficacy endpoint in Phase 2b KEYNOTE-942 trial;
(US) NOV CPI M/M: 0.1% V 0.3%E; Y/Y: 7.1% V 7.3%E (annual pace below lower-end of all analysts' expectations and records its 5th straight decline)
(US) TREASURY $18B 30-YEAR BOND REOPENING DRAWS 3.513% V 3.930% PRIOR; BID TO COVER 2.25 V 2.39 PRIOR AND 2.37 OVER LAST 8 REOPENINGS
(US) Atlanta Fed Nov Sticky-CPI annualized 5.5% v 5.5% m/m, core 5.4% v 6.5% m/m
(US) Congress negotiators said to have reached a “framework” to fund Govt through Sept 2023; House chamber expected to vote on one-week short-term extension as soon as today, Dec 14th - press

WED 12/14
(UK) NOV CPI M/M: 0.4% V 0.6%E; Y/Y: 10.7% V 10.9%E (annual pace moves off 40-year highs)
(CN) CHINA SAID TO DECIDE AGAINST POSTPONING ECONOMIC WORK CONFERENCE DESPITE COVID - PRESS
IEA Monthly Oil Report (OMR); Notes oil price may rally in 2023 as Russian exports sink and market heads to tighter Q2 2023 balance
(JP) BOJ said to be considering a policy review in 2023, but said to unlikely happen before BOJ Gov Kuroda steps down in Apr 2023 after his decade-long term - financial press
DAL Raises Q4 $1.35-1.40 (prior $1.00-1.25), Narrows Total Rev +7-8% (prior +5-9%) - pr ahead of Investor Day
(US) DOE CRUDE: +10.2M V -3.5ME; GASOLINE: +4.5M V +2.5ME; DISTILLATE: +3.7M V +3ME (largest weekly crude build since March 2021)

THRS 12/15
-(US) DEC EMPIRE MANUFACTURING: -11.2 V -1.0E (4th negative print in 5 months); New Orders: -3.6 v -3.3 prior
-(US) NOV ADVANCE RETAIL SALES M/M: -0.6% V -0.2%E; RETAIL SALES (EX-AUTO) M/M: -0.2% V +0.1%E; Retail Sales (control group): -0.2% v +0.1%e; prior revised lower
-(US) DEC PHILADELPHIA FED BUSINESS OUTLOOK: -13.8 V -10.0E; New Orders: -25.8 v -16.2 prior ; Prices Paid: 26.4 v 35.3 prior
(UK) BANK OF ENGLAND (BOE) RAISES BANK RATE BY 50BPS TO 3.50%; AS EXPECTED; Drops guidance on market path for interest rates; Sees inflation falling sharply from middle of 2023
(UK) BOE VOTED 6-1-2 TO RAISE INTEREST RATES; 2 FOR NO CHANGE; 1 FOR 75BPS; 6 FOR 50BPS
(EU) ECB RAISES KEY RATES BY 50BPS; AS EXPECTED; Expects to raise rates further, rates still have to rise significantly at steady pace; To be data dependent, keep meeting-by-meeting approach
(EU) ECB STAFF PROJECTIONS: Raises inflation outlook; Set 2025 Inflation at 2.3% (**Note: above target level in forecast horizon)
(EU) ECB chief Lagarde: Obvious to expect further 50bps hikes for a 'period of time'; ECB needs to do more on rates than markets' price - Q&A
ADBE reports Q4 $3.60 v $3.50e, Rev $4.53B v $4.52Be; affirms FY outlook
X guides Q4 $0.58-0.63 v $0.47e, adj EBITDA $375M; Sees Dec commercial demand better in US, scrap prices increasing

FRI 12/16
(US) DEC PRELIMINARY S&P/MARKIT MANUFACTURING PMI: 46.2 V 47.8E
(NL) ECB's Knot (Netherlands): Reiterates Council view that Fed is closer to end of rate hikes than
(US) Fed’s Williams (voter): Well on our way to where we need to be; Real rates need to become restrictive and stay there - TV interview ECB
(US) Fed's Daly (non-voter): We are far away from price stability goals; will need to get unemployment to mid-4% or even higher
(US) Reportedly US government to purchase 3M bbl of crude for SPR delivery in February - press
(CO) Colombia Central Bank raises Overnight Lending Rate by 100bps to 12.00%; as expected

Uncertainty keeps markets off balance ahead of more Fed tightening next week

TradeTheNews.com Weekly Market Update: Uncertainty keeps markets off balance ahead of more Fed tightening next week

12/9/2022 4:06:23 PM

US stocks came into the week with a negative tone after the S&P was unable to hold the 200-day moving average and economic data releases remained strong enough to keep the Fed vigilant in its tightening policy. China continued to signal further easing of its zero Covid policy, following a rhetorical shift out of top officials away from enforcing restrictions to downplaying Omicron's severity. Nevertheless, stocks tracked lower mid-week amid a raft of cautious corporate developments. Big tech continued to grapple with regulators, as the FTC confirmed it will seek to block Microsoft’s Activision deal, and the EU privacy watchdog will reportedly restrict Meta from using targeted behavioral ads. Costco rung up a disappointing quarter as same store sales fell to mid-single digits, while Walmart’s CEO noted the big box retailer has seen modest improvement in supply chains, but stressed the situation will likely remain a challenge into 2023. JP Morgan CEO Dimon reiterated that he believes the Fed when they say interest rates will stay higher for longer to cool off the economy. Higher rates and elevated geopolitical hurdles continue to present considerable uncertainty around the outlook for the US economy. The Treasury curve remained stubbornly inverted, reflecting those concerns about a potential 2023 recession.

Oil prices slid to the lows of the year after OPEC+ producers left their output plans unchanged coming into the week. The EU instituted the long awaited $60/bbl price cap on Russian seaborne oil on Monday. By Friday, President Putin was warning Russia could consider cutting output as part of a formal response to the EU embargo. Deflationary forces were not only evident in oil markets. The November Manheim used care index dropped 14% to its lowest level in more than a year. Adobe Analytics reported its November Digital Price Index (DPI) at -2.0% y/y, which was the biggest drop since the start of the pandemic, and particularly broad based with prices falling on a monthly basis in 15 of 18 categories. Toll Brother management emphasized the need for higher incentives to get homes closed in the current market on their earnings conference call. The benchmark US 10-year Treasury yield spent much of the week below 3.5%, in part reflecting ongoing worries of a potential Fed policy mistake. US stocks finally broke a 5-day losing streak on Thursday, a day after US Q3 labor productivity saw a welcome revision higher. Any momentum was short-lived though. Friday’s hotter than expected November PPI reading put modest downward pressure on stocks and bonds as investors turned their attention to next week’s CPI and Fed meeting. For the week, the S&P fell 3.3%, the DJIA was off 2.8%, and the Nasdaq gave up 4%.


SUN 12/4
(CN) CHINA NOV CAIXIN PMI SERVICES: 46.7 V 48.0E [3rd straight contraction ]OPEC+ makes no changes in its current oil output policy (as expected); Agrees to keep 2MBpd production cuts through Jan 2023; Notes it is ready to meet at short notice to address any oil market imbalance - press
(UR) IAEA chief Grossi: Hope to reach agreement on safety zone around Ukraine’s Zaporizhzhia nuclear power plant by the end-2022
(CN) CHINA NOV CAIXIN PMI SERVICES: 46.7 V 48.0E [3rd straight contraction ]

MON 12/5
TSLA Reportedly plans to reduce Shanghai output by up to 20% due to sluggish demand; The output cuts will take effect as soon as this week - press
(US) According to the latest CNBC Supply Chain Heat Map data, US manufacturing orders in China down 40% y/y; China to US container volume during Aug-Nov was down 21% y/y - CNBC
2317.TW Foxconn reports Nov (NT$) Rev 551.1B -11.4% y/y; Q4 expected to be roughly in line with market consensus; Notes Nov was the most affected period by the pandemic
*(CN) CHINA MAY ANNOUNCE DOWNGRADE OF COVID-19 TO LESS STRICT CATEGORY OF MANAGEMENT (CATEGORY B) AS EARLY AS IN JAN 2023 - PRESS
(US) Los Angeles Port Chief Gene Seroka: Expect a labor contract agreement in Feb/March 2023 time frame - CNBC
ODFL Reports Nov Rev per day +7.3%; LFL tons/day -8.6% primarily due to continued softness in the domestic economy
(SA) Saudi Arabia cuts most of its oil prices for Asia and Europe for Jan 2023; Maintains prices for US - press
(US) NOV FINAL S&P/MARKIT SERVICES PMI: 46.2 V 46.1E
(US) NOV ISM SERVICES INDEX: 56.5 V 53.3E; New Orders Index: 56, steady m/m
(CN) Reportedly US and EU considering new climate based tariffs on Chinese steel and aluminum aimed at addressing carbon output and overcapacity - press
(CN) Beijing City will no longer require COVID-19 results to enter most public venues except restaurants, gyms, aged-care centers, schools, and hospitals from Dec 6th; To still require 48-hour COVID results for bars and restaurants
(AU) RESERVE BANK OF AUSTRALIA (RBA) RAISES CASH RATE TARGET BY 25BPS TO 3.10%; AS EXPECTED

TUES 12/6
GS Head of Digital Assets unit: Planning to invest tens of millions of dollars to buy or invest in crypto companies after the collapse of the FTX exchange hit valuations and dampened investor interest - financial press
(RU) Russia Dep PM Novak: Reiterates Russia may reduce oil production, but not by much; Price cap will only lead to higher prices; Russia finds smaller oil traders, new insurers
International Air Transport Association (IATA) Director Walsh: Cuts 2022 airlines losses forecast to $6.9B (prior $9.7B) v $42B y/y; Sees 2023 passenger demand at 85.5% of 2019 levels
FAST Reports Nov net sales $577.8M +10.2% y/y
VVNT To be acquired by NRG Energy for $12/shr in $2.8B cash deal; NRG intends to complete its existing $1B share repurchase program over the near term
(US) US Pres Biden to visit TSMC building plant in Phoenix, Arizona later today; TSMC confirms to increase its investment in Arizona from current $12B to $40B in order to build a second plant in Arizona by 2026 - press
(CN) China Former Editor in Chief of Global Times Hu Xijin tweets: Chinese govt may soon announce new steps of COVID responses, and there will be follow-up actions in various parts of China. The cage of the epidemic is being shattered, and the appearance of Chinese society will change every week. We’ll definitely return to normal life.
META Regulators seek to restrict Meta's targeted ad model in Europe; Reportedly EU privacy regulators say as a condition of service Meta should not make 'behavioral ads' on Facebook and Instagram platforms - press
(NZ) Fonterra Global Dairy Trade Auction Dairy Trade price index: +0.6% v +2.4% prior
(US) Atlanta Fed GDPNow: Raises Q4 GDP forecast to 3.4% from 2.8%
MA Approves $9B share repurchase program (2.7% of market cap)
(JP) Japan Nov FX Reserves: $1.23T v $1.19T prior [6-year high]
(CN) China Dec 6th Politburo Meeting: Reiterates China to continue prudent monetary policy, monetary policy should be targeted and forceful; Urging coordinating covid controls and economic development - Chinese press
(IN) INDIA CENTRAL BANK (RBI) RAISES REPURCHASE RATE BY 35BPS TO 6.25%; AS EXPECTED

WED 12/7
*(CN) China Health Commission announces new coronavirus guidelines, Will allow home quarantines for asymptomatic or mild symptom patients (in line); No longer to require coronavirus tests for most public venues nationwide
(UK) NOV HALIFAX HOUSE PRICE INDEX M/M: -2.3% V -0.4% PRIOR; Y/Y: 4.7% V 8.3% PRIOR (biggest monthly drop since 2008 and 5th straight decline in annual pace)
(CN) China Health Commission official: We are close to returning to pre-pandemic living conditions; China's COVID infection rate and death remain lowest globally; The latest 10 measures are aimed at more precise and scientific pandemic control
6981.JP Key Apple's supplier Murata Manufacturing said to expect Apple to reduce iPhone 14 production plans further in the coming months because of weak demand - financial press
(CN) CHINA NOV FOREIGN RESERVES: $3.118T V $3.111TE
LOW Guides initial FY23 Rev $87-92B v $95.3Be v $97-98B y/y, SSS -4% to +2% y/y; Expecting to return $33B in capital over next 3 years - Investor Day slides
(CN) Beijing official: Beijing city will Not adopt any form of temporary COVID control measures; To restore normal production and living order, and resume work and production as soon as possible
(US) Q3 FINAL NONFARM PRODUCTIVITY: 0.8% V 0.6%E; UNIT LABOR COSTS: 2.4% V 3.1%E (lowest Unit Labor Costs Q/Q increase since Q4 2021)
Nov Manheim Used Vehicle Value Index: -0.3% M/M; -14.2% Y/Y; All eight major market segments lower, again
(US) OCT CONSUMER CREDIT: $27.1B V $28.0BE
CVX Adjusts FY23 Capex top end of $17.0B (prior close to $17.0B v below $15.0B expected for FY22); Includes $2B of lower carbon capex - analyst day
ASML.NL Netherlands expected to impose export restrictions on Tech Exports to China under agreement with US - press

THRS 12/8
(CN) Shanghai official: To scrap COVID test requirements for restaurants and entertainment venues from Dec 9th
(CN) China's NHC: Asymptomatic COVID patients need no treatment but health monitoring
(HK) Hong Kong Health Official Lee: To maintain most COVID restrictions; Social distancing measures to remain; Cuts quarantine time; effective from Dec 9th
TRP Reportedly shut down Keystone oil pipeline [622Kbpd] and mobilized equipment and people following confirmed oil leak near Steel City, NE - press
CIEN Reports Q4 $0.61 v $0.08e, Rev $971.0M v $851Me
BAC (US) BoA estimates Nov total card spending per household +1.7% y/y; Holiday spending continues to lag 2021 levels, forecast a 0.2% m/m decrease in core control retail sales in Nov
(US) INITIAL JOBLESS CLAIMS: 230K V 230KE; CONTINUING CLAIMS: 1.67M V 1.62ME (highest since Feb 202
(US) Pres Biden: Confirms US basketball star Griner will soon come back; Will continue to work to bring home all Americans
XOM Affirms annual Capex through FY27 $20-25B, Earnings and cash flow to double by FY27 v FY19; Expands share repurchases up to $50B through FY24 inc $15B in FY22
XOM CEO: Expects $100B in surplus cash by 2027, above Capex and dividends
ATVI US FTC formally sues to block Microsoft's $69B acquisition of Activision Blizzard
(US) US House passes several bills, including the $45B Defense Policy bill to boost military spending to to $857.9B in FY23 and the bill protecting same-sex marriage
AVGO Reports Q4 $10.45 v $10.27e, Rev $8.93B v $8.90Be; Raises quarterly dividend 12.2% to $4.60 from $4.10 (indicated yield 3.55%)
LULU CEO: Q3 will be high point for inventory; Comfortable with quantity, quality of inventory; factories have now returned to pre-pandemic levels of production efficiency - earnings call comments
COST Reports Q1 $3.07 v $3.14e, Rev $54.4B v $54.7Be
COST CFO: Guides FY23 Capex $3.8-4.0B v $3.89B y/y, Seeing modest improvement in inflation; Special dividend is likely question of when, not if - conf call comments
(CN) CHINA NOV CPI M/M: -0.2% V -0.2%E; Y/Y: 1.6% V 1.6%E

FRI 12/9
(CN) China official: No COVID tests required for entertainment venues, scenic areas and theaters; All hospitals must accept COVID patients; To renovate COVID makeshift hospitals for serious cases
(CN) China Finance Ministry (MOF) to sell CNY750B in special sovereign 3-year bonds to help domestic economy on Monday, Dec 12th
(US) Sen Sinema (D-AZ) said to be switching to independent - Politico
(EU) ECB announcement on TLTRO repayments: Banks to repay €447.5B of TLTRO III funds v €296B m/m
(RU) RUSSIA PRES PUTIN: WE ARE READY FOR AGREEMENTS ON UKRAINE; MAY CUT OUTPUT AS PART OF OIL-CAP RESPONSE; DECREE ON OIL-CAP RESPONSE TO COME IN A FEW DAYS
(US) DEC PRELIMINARY UNIVERSITY OF MICHIGAN CONFIDENCE: 59.1 V 57.0E; 1 year inflation expectations 4.6% v 4.9%e
(US) USDA WORLD AGRICULTURAL SUPPLY AND DEMAND ESTIMATES (WASDE) CROP REPORT: End 2022/2023 US Stocks (M bu) Soybeans: 220 v 236e; Corn: 1,257 v 1,241e; Wheat: 571 v 578e
(US) Q3 FINANCIAL ACCOUNT HOUSEHOLD CHANGE IN NET WORTH: -$392B V -$6.28T PRIOR
(US) Atlanta Fed GDPNow: Cuts Q4 GDP forecast to 3.2% from 3.4%

Downside CPI surprise heartens markets despite FTX collapse wounding the crypto market

TradeTheNews.com 

Weekly Market Update: Downside CPI surprise heartens markets despite FTX collapse wounding the crypto market

Fri, 11 Nov 04:08 PM EST/09:08 PM GMT

Investors waded into another crowded week of corporate earnings, key inflation data, and midterm elections that would likely see Republicans take control of one if not both chambers of Congress. Stocks took a step back after Tuesday’s election results didn’t turn out to be the landslide ‘red wave’ that many polls and pundits predicted. Another high-profile blowup in crypto markets added to the post-election uneasiness. Sam Bankman-Fried’s FTX saw a run on its assets wipe out the once $30B+ crypto-exchange in a matter of days after it was unsuccessful in reaching a bailout agreement with competitor Binance. Bitcoin plunged to new lows below $17K and uncertainty rippled across trading in equities and other risk assets. By Friday, FTX had declared bankruptcy and the now former CEO SBF faced serious legal allegations on a multitude of fronts.

Thursday’s CPI data shocked markets and resulted in one the largest bear market rallies in history. Led by the tech-heavy NASDAQ, stock indices exploded along with volumes. Bond yields and the US dollar reversed sharply lower after October CPI data offered the first signs of real relief for the Federal Reserve. A number of factors contributed to the shortfall in the core CPI but the most significant was a long-awaited deceleration in shelter costs. Healthcare costs unexpectedly slid, apparel prices fell for a second consecutive month rather than rebounding as expected, and the 2.4% decline in used car prices was more than twice as large as expected. The US 10-year yield dropped below 4% and the 2-year neared 4.3% after the inflation data, and the dollar index dropped over 4%, its biggest weekly decline in two and half years. Futures markets immediately took down expectations for the high in the fed funds rate next year back below 5%. Several Fed officials openly welcomed the report while also acknowledging there is still a long way to go on inflation. Positive investor sentiment largely held into Fridays Veteran’s Day trade when US bond markets were closed. Most US stock indices added to gains helped by additional reports out of China that, despite rising Covid numbers, officials there would continue relaxing certain zero-Covid restrictions. Thanks to the CPI report, stocks posted a strong week, with the S&P up 5.9%, the DJIA adding 4.2%, and the Nasdaq surging 8.1%.

Aside from the collapse of FTX and early policy stumbles at Elon Musk’s Twitter, other corporate news centered on big tech and media names this week. Disney shares tested 52-week lows after reporting much worse than expected earnings, driven by losses for its Disney+ streaming service, despite better than expected subscriber numbers on the platform. Meta, which also reported poor results last month, gave some hope to investors by announcing efforts to get costs under control, largely via job cuts. Apple said COVID-19 restrictions in China have temporarily impacted a key assembly facility, leading to lower production and shipments of iPhone 14 Pro handsets. In another sign that an economic slowdown is occurring, FedEx said it can’t provide a FY23 earnings outlook at this point, noting demand for air freight had dropped faster than expected, causing the firm to cut flights and park aircraft.


SUN
BRK.A Reports Q2 EPS (Class B) -$1.22* v $4.59 y/y, Rev $76.9B v $57.8B y/y
AAPL Provides updates on supply of iPhone 14 Pro and iPhone 14 Pro Max, COVID restrictions in China have temporarily impacted assembly, expect lower shipments; Continue to see strong demand

MON
*(CN) CHINA OCT FOREIGN RESERVES: $3.052T V $3.039TE; Notes domestic economic fundamentals continue to support FX reserve stability
(UR) Reportedly EU and US allies in NATO identified a short-term negotiation window for Ukraine war; See Ukraine may need to re-capture Kherson city and then push for a ceasefire from a position of strength - Italian press
(CN) REPORTEDLY CHINA LEADERS CONSIDER STEPS TOWARD REOPENING; NO TIMELINE SET, BUT A RETURN TO PRE-PANDEMIC LEVELS OF ACTIVITY NOT LIKELY BEFORE END-2023 - US FINANCIAL PRESS
Oct Manheim Used Vehicle Value Index: -2.2% M/M; -10.6% Y/Y
(US) SEPT CONSUMER CREDIT: $25.0B V $30.0BE
(JP) Japan Oct FX Reserves: $1.19T v $1.24T prior

TUES
7974.JP President: No plans to raise prices on Switch; Chip supply has been recovering since Sept, have increased Switch production since Oct
(EU) According to EU's Climate Change Service, Europe saw warmest October on record, 2 degrees Celsius above the 1991-2020 reference period - press
BLDR Reports Q3 $5.20 v $3.53e, Rev $5.80B v $5.22Be
(EU) European Commission said to have told countries that there is no way to create gas price cap as requested by EU leaders at Oct 20-21st summit - press
FTX.IPO Binance signs non-binding LOI to fully acquire FTX.com to help cover liquidity crunch
FDX CFO: We have cut flights and parked planes as demand drops; Decline in air demand has been quicker than expected - Baird conf comments
DIS Reports Q4 $0.30 v $0.50e, Rev $20.2B v $21.1Be
(CN) CHINA OCT CPI M/M: 0.1% V 0.3%E; Y/Y: 2.1% V 2.4%E

WED
(US) Fetterman (D) projected to beat Oz (R) in Pennsylvania for Republican-held US Senate seat (1st potentially flipped state for Senate race) - ABC News
EOAN.DE Reports 9M Adj Net €2.13B v €2.19B y/y, Adj EBIT €4.03B v €3.93B y/y, Rev €81.6B v €48.1B y/y; Supports German govt's plans and prepares to implement gas price cap
7267.JP Reports H1 Net ¥338.5B v ¥389.2B y/y, Op ¥453.5B v ¥442.2B y/y, Rev ¥8.09T v ¥6.99T y/y; Raises FY22/23 outlook, but cuts vehicle sales forecast citing chip shortage
ADS.DE Reports Q3 Net €0.34 v €0.47e, Op €564M v €672M y/y, Rev €6.41B v €6.25Be; Cuts again FY22 outlook to reflect Yeezy partnership as its high seasonality geared towards Q4
AD.NL Reports Q3 adj €0.70 adj v €0.59e, Rev €22.4B v €18.5B y/y
7201.JP Reports H1 Net ¥64.5B v ¥168.7B y/y, Op ¥156.6B v ¥139.1B y/y, Rev ¥4.66T v ¥3.95T y/y; Raises FY22/23 Rev outlook. but cuts vehicle sales forecast; Expects chip shortage and higher costs to continue in H2
IBE.ES Presents strategic plans and profit forecasts; Expects EBITDA to reach €16.5-17B by 2025; Plans to invest €47B in its electricity networks
META Affirms Q4 outlook and cuts slightly FY23 Opex; Confirms to cut 11K employees (13% of its workforce) citing lower Rev outlook than anticipated before; Extends hiring freeze into Q1 2023 with some exceptions
PFGC Reports Q1 $1.08 v $0.79e, Rev $14.7B v $14.4Be; Raises outlook
DHI Reports Q4 $4.67 v $5.06e, Rev $9.64B v $10.0Be; Since June and continuing through today, saw a moderation in housing demand
IBM Unveils 400 Qubit-Plus quantum processor and next-generation IBM Quantum System Two; Outlines plan by 2023 end for QT2
FTX.IPO Reportedly Binance is likely to scrap bailout of FTX following initial due diligence - press
(US) Atlanta Fed GDPNow: Raises Q4 GDP forecast to 4.0% from 3.6%
(US) USDA WORLD AGRICULTURAL SUPPLY AND DEMAND ESTIMATES (WASDE) CROP REPORT

THRS
TSM Reports Oct (NT$) Rev 210.3B v 134.5B y/y; Jan-Oct Rev 1.85T v 1.28T y/y
(CN) China Politburo: Urge to stick to zero-COVID policy; to target more precise but look to minimize impact on economy via more targeted control; China top leaders strive to protect normal production and life
TGT Debuts its new store strategy and larger-format store design; Will focus on this larger footprint in the next few years
(US) INITIAL JOBLESS CLAIMS: 225K V 220KE; CONTINUING CLAIMS: 1.49M V 1.49ME
(US) OCT CPI M/M: 0.4% V 0.6%E; Y/Y: 7.7% V 7.9%E (annual pace below lower-end of all analysts' expectations and records its 4th straight decline)
ASML.NL Targets Long term Rev €30-40B, gross margin 54-56%; Initiates up to €12.0B share buyback
(US) Atlanta Fed Oct Sticky-CPI annualized 5.5% v 8.5% m/m, core 5.0% v 8.3% m/m
(US) Fed's Mester (FOMC voter): October CPI shows signs of moderation on inflation; Inflation is still broad-based, with services prices not slowing
(JP) Japan Oct PPI (CGPI) M/M: 0.6% v 0.7%e; Y/Y: 9.1% v 8.8%e

FRI
(CN) China National Health Commission announced measures to minimize number of people under COVID control; Will now identify close contacts only, and no longer identify close contacts of close contacts
(UK) Q3 PRELIMINARY GDP Q/Q: -0.2% V -0.5%E; Y/Y: 2.4% V 2.1%E
(DE) GERMANY OCT FINAL CPI M/M: 0.9% V 0.9%E; Y/Y: 10.4% V 10.4%E
(UK) SEPT INDUSTRIAL PRODUCTION M/M: +0.2% V -0.3%E; Y/Y: -3.1% V -4.4%E
(CN) China Foreign Min spokesperson Zhao Lijian: China is not taking 'laid back' approach to COVID; China COVID changes do not mean relaxing containment; China and US should establish right way forward in ties
(RU) Russian Dep Foreign Min: Russia and US to hold nuclear arms treaty in end-Nov to early-Dec - Russian press
(EU) EU Commission Autumn Forecasts: Inflation peak expected at end-2022; Expects economic growth to return to Eurozone in spring 2023
(UK) BOE Gov Bailey: Expects efforts to bring inflation under control to likely take between 18 months and two years; Further increases to interest rates likely in the coming months – press
FTX.IPO Commences Chapter 11 bankruptcy proceedings in the United States; CEO Sam Bankman-Fried resigns – press
(US) NOV PRELIMINARY UNIVERSITY OF MICHIGAN CONFIDENCE: 54.7 V 59.5E

Peak inflation debate rages on amid fresh recession signals and mixed earnings reports

TradeTheNews.com 

Weekly Market Update: Peak inflation debate rages on amid fresh recession signals and mixed earnings reports

Fri, 28 Oct 04:10 PM EST/09:10 PM GMT

US stock markets opened the week looking build on Friday’s momentum while rates held below cycle highs. On Monday, sovereign bond yields dropped across Europe, led by the Gilt markets, after it became clear Rishi Sunak would become the next PM. As expected, President Xi tightened his grip further at a key China Communist Party meeting. After eliminating influence of opposition and moderating voices, and signaling to markets there won’t be any change in direction on economic, tech, or COVID policies, Chinese stock markets came under significant pressure. Regardless US stock prices held up well heading into a key stretch of corporate earnings reports.

US stocks largely continued to track higher mid-week, headlined by the Dow as it neared 6-week highs. Earnings standouts like Coca-Cola, Caterpillar, and GM, helped in large part by their continued ability to pass along and benefit from price increases, offset disappointing results and weak outlooks from a host of mega-cap tech bellwethers. Also, economic data continued to soften, supporting those who believed the Fed was nearing an inflection point where they could slow the pace at which they raise rates into the end of the year. The Bank of Canada raised rates less than expected, while other central banks that led the way into this rate hike cycle also offered slightly more dovish signals, along with a bit more two-sided commentary from some Fed officials. Nevertheless, markets flashed further signals that damage may have already been done. The US 10-year yield dropped below 4% resulting in the curve inverting below that of the 3-month T-bill rate. This classic recession signal was last seen in March of 2020.

Rates popped back up on Friday after a string on shockingly high EU CPI readings. That trend was moderated somewhat by two constructive pieces of US inflation data: Both the year over year September PCE deflator and the University of Michigan 1-year inflation outlook came in one-tenth lower than expected, sparking renewed hopes that ‘peak inflation’ may have been reached. Oil prices moved a bit higher during the week, but natural gas slipped modestly lower. For the week, the S&P gained 3.9%, the DJIA surged 5.7%, and the Nasdaq rose 2.2%.

Tech earnings took center stage in corporate news this week. Alphabet posted its lowest revenue growth since 2020 as economic weakness continued to hamper online ad spend. Microsoft saw its weakest sales growth in five years amid a drop in demand for its Windows OS. Meta’s share price dropped to its lowest level since 2016 as CEO Zuckerberg continues the pursuit of his costly Metaverse venture despite declining revenue. Amazon shares tumbled after giving a dour revenue outlook for its holiday quarter as it gets set to ‘tighten its belt.’ Amid this tech gloom and doom, Apple stock propped up the markets on Friday, surging after the consumer tech giant posted beats on its top and bottom line despite seeing some weakness in iPhone sales and services. Intel shareholders also recouped some losses as the chipmaker laid out significant cost-cutting plans amid a reduction to its FY22 forecast as it reported an earnings beat.


SUN 10/23
(CN) China Pres Xi obtains the 3rd five-year presidential term (as expected); Li Qiang named new China's Premier; Politburo Standing Committee members cut to 24 from 25
2330.TW Reportedly TSMC has suspended production of advanced silicon for China-based firm Biren Technology to ensure compliance with US curbs - press
(RU) Russian state press circulate reports citing 'credible sources in Ukraine and various other countries' that Ukraine is preparing a provocation using a 'dirty bomb' or 'low-yield nuclear weapon'; Russian Defense Min Shoigu held talks with US, UK, French and Turkish Defense Ministers
(UK) Chancellor of the Exchequer (Fin Min) Hunt reportedly considers up to £20B in tax rises on high earners in his medium-term fiscal budget announcement due on Oct 31st - UK press
*(UK) BORIS JOHNSON PULLS OUT OF UK PM LEADERSHIP RACE - STATEMENT
*(CN) CHINA SEPT RETAIL SALES Y/Y: 2.5% V 3.5%E; YTD Y/Y: 0.7% V 1.0%E
*(CN) CHINA SEPT TRADE BALANCE: $84.7B V $80.3BE
MON 10/24
PHIA.NL Reports Q3 adj EBITA €209M v €512M y/y, Rev €4.3B v €4.3B prelim; Starts restructuring, sees €300M charges in coming quarters; To cut 4,000 jobs globally (~5% of workforce)
*(FR) FRANCE OCT PRELIMINARY MANUFACTURING PMI: 47.4 V 47.0E (2nd straight contraction and lowest since May 2020)
*(DE) GERMANY OCT PRELIMINARY MANUFACTURING PMI: 45.7 V 47.0E (4th straight contraction and lowest since June 2020)
TTF European gas futures extend losses to €100/MW (lowest since early June) amid EU talks to intervene into energy markets and warmer-than-usual temperatures this autumn in Europe
*(EU) EURO ZONE OCT PRELIMINARY MANUFACTURING PMI: 46.6 V 47.9E (4th straight contraction and lowest since May 2020)
*(UK) OCT PRELIMINARY MANUFACTURING PMI: 45.8 V 48.0E (3rd straight contraction and lowest since May 2020)
7203.JP Said to be considering a reboot of its ~$38B EV strategy announced last year to better compete with rivals like Tesla; Reportedly halted some work on existing EV projects; Targets early 2023 to complete review - press
(RU) Russian govt spokesperson Peskov: West's lack of confidence does not mean that the threat of such 'dirty bomb' in Ukraine ceases to exist; The threat presents and this information was brought to the attention of Western defense ministers
VSTO Reports prelim Q2 $1.71 v $1.71e, Rev $782M v $753Me; CFO Sudhanshu Priyadarshi to depart; Andrew Keegan named interim CFO, effective immediately
(US) DOJ to hold press conference today on 'significant national security matter'
(RU) Russian Defense Ministry: Ukraine wants to present the 'dirty bomb' explosion as an abnormal operation of a Russian nuclear weapon - statement
LOGI Reports Q2 $0.84 v $0.81e, Rev $1.15B v $1.21Be; CFO to leave the company, but stay on through transition
TUES 10/25
5.HK Reports Q3 Net $2.6B v $4.3B y/y, adj Pretax $6.51B v $6.09Be, Rev $14.3B v $13.5Be: CFO to step down, confirms considering sale of Canada unit
UBSG.CH Reports Q3 Net $1.73B v $2.28B y/y, Rev $8.24B v $9.13B y/y
NOVN.CH Reports Q3 Core EPS $1.58 v $1.57e, Rev $12.54B v $12.9Be
SAP.DE Reports Q3 €1.12 adj v €1.28e, adj EBIT €2.09B v €2.05Be, Rev €7.84B v €7.59Be; Expects to accelerate Rev growth and double-digit operating profit growth in 2023
*(DE) GERMANY OCT IFO BUSINESS CLIMATE SURVEY: 84.3 V 83.5E
(RU) Reports circulating that a new NOTAM** notice was issued for Oct 26-29th for potential ICBM test launches from Russia's Plesetsk and SLBM test launches from the coast of the Kola Peninsula to the Kura missile range
(CN) China issues rules to promote development of individual businesses from Nov 1st; To encourage and guide venture capital institutions and social funds to support development of individual businesses - Chinese press
UPS Reports Q3 $2.99 v $2.84e, Rev $24.2B v $24.3Be
PII Reports Q3 $3.25 v $2.85e, Rev $2.34B v $2.19Be
GE Reports Q3 $0.35 v $0.47e, Rev $19.1B v $19.0Be; Cuts outlook; Plans to initiate restructuring program across GE Vernova businesses
GM Reports Q3 $2.25 v $1.89e, Rev $41.9B v $41.8Be
PHM Reports Q3 $2.69 v $2.75e, Rev $3.94B v $4.04Be
KO Reports Q3 $0.69 v $0.64e, Rev $11.1B v $10.6Be; Organic Rev +16%; Raises FY22 outlook
ADM Reports Q3 $1.86 v $1.42e, Rev $24.7B v $22.9Be
VOW3.DE Exec: We have never had the level of shortages in supply chain that we see today
ITW Reports Q3 $2.35 v $2.25e, Rev $4.01B v $3.93Be; Organic rev +16%; Raises guidance
PCAR Reports Q3 $2.21 v $2.01e, Rev $6.69B v $6.73Be
(SA) Saudi Oil Min Abdulaziz: We need to retain spare oil capacity; Having spare capacity pays off; Running out of spare capacity would have a great cost
MAERSKB.DK Exec: Congestion on West Coast has eased significantly; NA volumes remain “relatively unchanged” since September
*(US) OCT RICHMOND FED MANUFACTURING INDEX: -10 V -5E; New orders: -22 v -11 prior
*(US) OCT CONSUMER CONFIDENCE: 102.5 V 106.0E
ML.FR Reports 9M Rev €20.7B v €17.2B y/y; Cuts FCF forecast
MSFT Reports Q1 $2.35 v $2.29e, Rev $50.1B v $49.5Be
GOOGL Reports Q3 $1.06 v $1.25e, Rev (ex TAC) $57.3B v $58.2Be; Notes it is working to realign resources for growth
V Reports Q4 $1.93 v $1.86e, Rev $7.79B v $7.55Be; Authorizes $12.0B buyback program; Raises dividend 20% to $0.45/shr
MSFT Guides Q2 Rev $52.4-53.4B v $55.5Be - earnings call
BMY Reports Q3 $1.99 v $1.83e, Rev $11.2B v $11.0Be
*(AU) AUSTRALIA Q3 CPI Q/Q: 1.8% V 1.6%E; Y/Y: 7.3% V 7.1%E (highest annual pace since 1990)
WEDS 10/26
*(AU) AUSTRALIA Q3 CPI Q/Q: 1.8% V 1.6%E; Y/Y: 7.3% V 7.1%E (highest annual pace since 1990)
DBK.DE Reports Q3 Net €1.12B v €194M y/y, Rev €6.92B v €6.04B y/y
MBG.DE Reports Q3 Net €4.00B v €3.52B y/y, adj EBIT €5.34B v €3.11B y/y, Rev €37.7B v €31.65B y/y; Raises FY22 adj ROS outlook
BAS.DE Reports final Q3 €1.77 v €1.56 y/y, Adj EBIT €1.35B v €1.35B prelim, Rev €21.9B v €21.9B prelim
(DE) German govt reportedly approves China's Cosco to acquire 24.9% of Hamburg port's operator - press
BAS.DE CEO: To to cut costs in Europe as quickly as possible and also permanently; Number of retirements in the next few years goes up significantly; Also have positions that are not filled as we have problems getting experts and well-trained people - post earnings comments
UMC Reports Q3 (NT$) 2.19 v 1.96e, Rev 75.4B v 72.8Be; Cuts FY22 Capex outlook; Notes softening demand in consumer end markets
HLT Reports Q3 $1.31 v $1.25e, Rev $2.37B v $2.37Be
BG Reports Q3 $3.45 v $2.44e, Rev $16.8B v $15.6Be; Raises FY22 adj EPS outlook
GPI Reports Q3 $11.91 adj v $10.99e, Rev $4.16B v $4.07Be
ADP Reports Q1 $1.86 v $1.78e, Rev $4.22B v $4.15Be
*(RU) RUSSIA PRES PUTIN HAS TAKEN PART IN NUCLEAR STRATEGIC DETERRENCE FORCES DRILLS (AS SPECULATED) - PRESS
BA Reports Q3 -$6.18* v -$0.01e, Rev $16.0B v $17.5Be
MNRO Reports Q2 $0.43 v $0.62 y/y, Rev $329.8M v $347.7M y/y; Did not fully pass-through Px inflation in Q2
(CA) Bank of Canada (BOC) Gov Macklem: Seeing early encouraging signs that underlying inflation is beginning to come down but still far from goals; Still not there yet on ending tightening phase but we are getting closer - post rate decision press conference
MBLY IPO opens for trade at $26.71
(US) Association of American Railroads weekly rail traffic report for week ending Oct 22nd: 505K total units, -1.1% y/y
(US) Atlanta Fed GDPNow: Raises Q3 GDP to 3.1% from 2.9%
VERU (US) FDA provides updated agenda for November 9, 2022 Meeting of the Pulmonary-Allergy Drugs Advisory Committee Meeting Announcement; To review EUA for Sabizabulin for hospitalized COVID-19 patients at high risk for acute respiratory distress syndrome until Nov. 9, 2022
F Reports Q3 $0.30 v $0.31e, Rev $37.2B v $38.3Be; Confirms charge related to wind down of Argo Ai
META Reports Q3 $1.64 v $1.88e, Rev $27.7B v $27.4Be; Expects Reality Labs operating losses in 2023 will grow significantly y/y
(RU) White House is reportedly reworking a plan for a Russia oil price cap; So far only only G7 countries and Australia have agreed to abide by the price cap - press
005930.KR Reports final Q3 (KRW) Net 9.4T v 12.3T y/y; Op 10.9T v 15.8T y/y, Rev 76.8T v 74.0T y/y; Expects demand to recover in 2023, not considering artificial memory production cut; Promotes Jay Y. Lee to Chairman
(CN) China Pres Xi: China is willing to find ways to cooperate with the US; Better exchanges will bolster global peace and development - Chinese press
THURS 10/27
CSGN.CH Reports Q3 (CHF) Net -4.03B v -505Me v -1.59B y/y, Rev 3.80B v 5.44B y/y; Announces CHF4.0B capital raise; Notes during first two weeks of Oct, amid incorrect market rumors, experienced a significant level of deposit and AuM outflows
CSGN.CH Unveils new strategy and transformation plan; Headcount reduction of 2,700 jobs underway in Q4; Radically restructure the Investment Bank to significantly reduce Risk Weighted Assets; To reduce cost base by 15%, or ~CHF2.5B (prior expected by 8%)
SHEL.UK Reports Q3 $1.30 v $0.53 y/y, Adj CCS Net $8.10B v -$988M y/y, Rev $95.7B v $60.0B y/y; Announces $4B share buyback for up to 528.9M shares (2% of market cap); to raise dividend by 15%
UNA.NL Reports Q3 Rev €15.8B v €15.1Be; Raises FY22 Sales outlook; Sees challenges of high inflation to persist in 2023
TTE.FR Reports Q3 Adj Net $9.86B v $4.77B, adj Op $19.4B v $11.2B y/y, Rev $64.9B v $49.1B y/y; raises dividend 5% to €0.69/shr
(RU) Russia Foreign Ministry official: US quasi-civilian satellites may become legitimate targets for a retaliatory strike, if they are involved in armed conflicts
(JP) Japan final draft total size of stimulus package of ¥71.6T (~$488B) - financial press
LIN.DE Reports Q3 $3.10 v $2.94e, Rev $8.80B v $8.27Be
SWK Reports Q3 $0.76 v $0.73e, Rev $4.12B v $4.12Be; Cuts outlook
HON Reports Q3 $2.25 adj v $2.16e, Rev $8.95B v $9.08Be
CAT Reports Q3 $3.95 v $3.19e, Rev $15.0B v $14.3Be
MRK Reports Q3 $1.85 v $1.67e, Rev $15.0B v $14.1Be
CAT Reports Q3 dealer statistics: Total machines +7% v -3% prior
HON Guides Q4 $2.46-2.56 v $2.51e, Rev $9.1-9.4B v $9.35Be; Expect 2023 growth in top-line with margin expansion - earnings slides
CCJ Reports Q3 C$0.03 v -C$0.14 y/y, Rev C$389M v C$361M y/y
CAT Guides Q4 Rev to be highest quarter of the year reflecting typical seasonality; Q4 adj Op margin 'strong' - earnings slides
CBRE Reports Q3 core $1.13 adj v $1.24e, Rev $7.53B v $7.90Be
MCD Reports Q3 $2.68 v $2.57e, Rev $5.87B v $5.71Be
CMCSA Reports Q3 $0.96 adj v $0.89e, Rev $29.85B v $29.7Be
FISV Reports Q3 $1.63 v $1.70e, Rev $4.52B v $4.27Be
(CN) China's Cabinet deploys a package of measures to stabilize domestic economy; Will promote recovery in consumption; Calls for keeping economy within a reasonable range - press
7203.JP Cuts again FY22 global volume 9.5M units +10% y/y (prior <9.7M) - financial press
MA Guides Q4 adj Rev low end of low double digits %, adj Rev (CC) high end of mid teens - slides
*(EU) ECB RAISES KEY RATES BY 75BPS; AS EXPECTED; Expects to raise interest rates further over next several meetings, deciding meeting by meeting
*(EU) ECB DECIDES TO CHANGE TLTRO-III TERMS; From Nov 23rd to maturity or early repayment date, the interest rate on TLTRO III operations will be applicable key ECB interest rate over this period
*(US) Q3 ADVANCE GDP ANNUALIZED: Q/Q: 2.6% V 2.4%E (moves out of technical recession); PERSONAL CONSUMPTION: 1.4% V 1.0%E
*(US) Q3 ADVANCE GDP PRICE INDEX: 4.1% V 5.3%E; CORE PCE Q/Q: 4.5% V 4.5%E
(EU) ECB chief Lagarde: Expect economy to slow down substantially over remainder of year; Growth risks clearly on downside in the short term - Prepared remarks
(EU) ECB chief Lagarde: Not done in normalizing policy; More discussions on increases in the future - Q&A
(US) Nevada reports Sep casino gaming Rev $1.25B, +7.9% y/y; Las Vegas strip Rev $693M, +8.3% y/y
BN.FR Reports Q3 Rev €7.33B v €7.00Be
AMZN Reports Q3 $0.28** v $0.23e, Rev $127.1B v $127.9Be
INTC Reports Q3 $0.59 v $0.34e, Rev $15.3B v $15.5Be; Details significant cost cutting plans; Cuts FY22 outlook
X Reports Q3 $1.95 v $1.92e, Rev $5.2B v $4.91Be
INTC CEO: In near term flexible workforce will be impacted; Will be aggressive in cost cutting including headcount - media interview
AAPL Reports Q4 $1.29 v $1.26e, Rev $90.2B v $88.5Be
AMZN CFO: People's budgets are tight and we are being prudent in hiring; Amazon is preparing for what could be a slower growth period - media interview
FRI 10/28
AIR.FR Reports Q3 adj Net €667M v €404M y/y, Adj EBIT €836M v €666M y/y, Rev €13.3B v €10.5B y/y
*(FR) FRANCE Q3 PRELIMINARY GDP Q/Q: 0.2% V 0.2%E; Y/Y: 1.0% V 1.0%E
SAN.FR Reports Q3 Business EPS €2.88 v €1.85 y/y, Op €4.50B v €3.04B y/y, Rev €12.5B v €10.4B y/y
066570.KR Reports final Q3 (KRW) Net 336.5B v 516.5B y/y; Op 746.6B v 596.8B y/y, Rev 21.2T v 21.2T prelim; Expects demand for home-appliances, IT devices to contract in Q4
ENI.IT Reports Q3 adj Net €3.73B v €1.43B y/y, adj Op €5.77B v €2.49B y/y, Rev €37.3B v €19.3B y/y; Prev announced €2.4B buyback to be completed by year-end
(JP) BOJ Gov Kuroda: Reiterates stance that do not expect a rate hike or exit from easing policy any time soon - post rate decision press conference
*(FR) FRANCE OCT PRELIMINARY CPI M/M: 1.0% V 0.6%E; Y/Y: 6.2% V 5.8%E
*(ES) SPAIN Q3 PRELIMINARY GDP Q/Q: 0.2% V 0.3%E; Y/Y:3.8 % V 3.9%E
*(DE) GERMANY Q3 PRELIMINARY GDP Q/Q: +0.3% V -0.2%E; Y/Y: 1.2% V 0.7%E
(CN) China banking regulator (CBIRC) official: Chinese yuan (CNY) market position won't change despite some unstable factors in short term; You will regret it in the future for selling CNY now to buy FX
*(IT) ITALY OCT PRELIMINARY CPI M/M: 3.5% V 1.1%E; Y/Y: 11.9% V 9.5%E (highest annual pace for Italy on record and highest pace now among top 5 EU economies)
CVX Reports Q3 $5.56 v $5.02e, Rev $66.6B v $59.0Be; Repurchased $3.75B of shares during Q3
CVX CFO: Raises FY23 Capex close to $17.0B (prior $15.0-17.0B) v below $15.0B expected for FY22; Expect share buybacks at top end of guidance range of up to $15B - post earnings comments
1211.HK Reports Q3 (CNY) Net 5.72B v 1.27B y/y, Rev 117.1B v 54.3B y/y
BAH Reports Q2 $1.34 v $1.12e, Rev $2.30B v $2.24Be
ABBV Reports Q3 $3.66 v $3.56e, Rev $14.8B v $14.9Be; Raises Quarterly dividend 5% to $1.48 from $1.41 (indicated yield 3.86%)
*(DE) GERMANY OCT PRELIMINARY CPI M/M: 0.9% V 0.6%E; Y/Y: 10.4% V 10.1%E
GWW Reports Q3 $8.27 v $7.19e, Rev $3.94B v $3.88Be
*(US) Q3 EMPLOYMENT COST INDEX (ECI): 1.2% V 1.2%E
*(US) SEPT PERSONAL INCOME: 0.4% V 0.4%E; PERSONAL SPENDING: 0.6% V 0.4%E
*(US) SEPT PCE DEFLATOR M/M: 0.3% V 0.3%E; Y/Y: 6.2% V 6.3%E
*(US) OCT FINAL UNIVERSITY OF MICHIGAN CONFIDENCE: 59.9 V 59.6E
*(US) SEPT PENDING HOME SALES M/M: -10.2% V -4.0%E; Y/Y: -30.4% V -22.5% PRIOR
(US) Atlanta Fed GDPNow: Forecasts initial Q4 GDP at 3.1%
(US) Sep Dallas Fed Trimmed Mean PCE +4.3% v +6.0% m/m

UK government policy reversal not enough to comfort markets gripped by inflation

TradeTheNews.com 

Weekly Market Update: UK government policy reversal not enough to comfort markets gripped by inflation

Fri, 14 Oct 04:15 PM EST/09:15 PM GMT

Stocks remained heavy coming into the week as last Friday’s strong September jobs report kept the door wide open for further Fed tightening. Volatility rose, foreshadowing wild trading to come in the aftermath of Thursday’s CPI release. Worries surrounding the UK Gilt markets festered. On Tuesday, the UK 10-year Gilt hit a fresh 14-year high above 4.5% after the BOE once again affirmed plans to end its emergency bond-buying program on Friday. The BOE was subsequently forced to step in again by widening its emergency bond-buying operations, but Governor Bailey drew the line in the sand when he called on UK pension funds to right-size LDI exposure before the opportunity closes. Speculation also continued to swirl that PM Truss would ultimately be forced to backtrack on some of the key promises of Chancellor Kwerteng’s mini budget. Separately, the Japanese Yen hit fresh 24-year lows against the dollar after the BOJ Governor Kuroda reiterated they will continue easing in Japan despite the starkly divergent monetary policy relative to the US and Europe. By Wednesday, US stock markets were riding a 6 day losing streak after PPI data topped expectations ahead of the CPI numbers on Thursday.

The September CPI report wasn’t pretty, but really shouldn’t have surprised anyone, and the markets more than shrugged it off. Core CPI posted another gain of 0.6% m/m, topping estimates and climbed to the highest annual pace since 1982, notching a 6.6% reading. The composition of the inflation increase offered no immediate reason to hope for a quick reversal. Much of the upside disappointment was due to shelter costs, which continue to accelerate, posting the largest monthly gain since 1990. The hot CPI print cemented expectations that the Fed will hike by 75 bps in November and tipped futures odds in favor of another 75 bps in December, boosting the market’s expectation for the terminal rate to top out north of 4.8% in 2023. Nevertheless, after opening lower with the S&P testing 3500, stocks roared back with an eye popping classic bear market rally on significant volumes. S&P futures had nearly a 200 point swing from the morning’s lows in what mostly attributed to short covering and oversold options positioning.

Friday saw another 100+ point swing in the futures, but this time to the downside. Follow though momentum into the NY open faded alongside another chorus of Fed officials emphatically reiterating financial conditions need to tighten further and stay there in order to bring inflation down. University of Michigan data offered no reprieve on the inflation front after 1-year inflation expectations rose sharply above consensus. UK Gilt markets remained in focus after PM Truss dismissed Chancellor Kwarteng and, as speculated, backtracked on key measures of the unsettling mini budget announcement. The Pound remained under pressure and UK yields rose in the aftermath of her press conference, suggesting the situation is far from resolved with the BOE backstop now gone and QT set to commence at the end of the month. WTI crude prices dropped 3% into week’s end, perhaps helped in part by some marginally softer rhetoric from Putin towards Ukraine. The US dollar remained bid while Treasury yields drifted back towards cycle highs with the 2-year back above 4.5% and the 10-year retesting 4%. For the week, the S&P lost 1.5%, the DJIA gained 1.2%, and the Nasdaq dropped dropped 3.1%.

In corporate news this week, a wide variety of consumer companies touted better than expected quarterly results. PepsiCo shares popped as the company reported strong Q3 numbers and raised fiscal year guidance, saying that global business momentum remains strong. Luxury goods maker LVMH beat quarterly revenue expectations and expressed confidence that current growth will continue. American Airlines lifted off from recent lows after raising its Q3 guidance ahead of next week’s earnings release, though rival Delta reported earnings and revenue a bit below forecast. Financial services firms started the new earnings season off on a positive note, with Wells Fargo and Citigroup beating estimates handily. JP Morgan also reported better than expected results for Q3 even after CEO Dimon warned earlier in the week that the US economy will likely slip into an actual recession within the next nine months. Apple took a deeper step into the fintech market with the launch of a new high-yield savings account for Apple Card from Goldman Sachs. The woes in the chip sector continued to pile up as a report said Intel plans thousands of layoffs, including 20% of sales and marketing staff, amid the slowdown in PC sales. And in M&A news, Kroger proposed creating a grocery giant via a $24.6B merger with Alberstons, a merger that may face significant regulatory scrutiny.






SUN 10/9
(RU) Russian govt spokesperson Peskov: It is wrong to consider the terrorist attack on the Crimean bridge as a reason for the possible use of nuclear weapons according to Russian doctrine
MON 10/10
(UR) Telegram channels circulating reports on 'massive explosions' near centers of Ukraine capital Kyiv and several biggest cities Dnipro, Lviv, Zhytomyr
(RU) Belarus President Lukashenko: Belarus and Russia to form a joint regional grouping of troops; The process of formation of this group has been going on for two days; NATO and a number of European countries are considering options for possible aggression against Belarus
(CN) China's PBOC and ECB said to renew Euro-Chinese yuan swap agreement worth CNY350B - press
(UK) Treasury Select Committee Head: Govt to bring forward medium-term fiscal plan OBR forecast to Oct 31st from Nov 23rd
(CN) Shanghai requires arrivals to take 3 COVID tests within 3 days - press
(UR) During today's Russian massive missile attacks on regional centers in Ukraine, visa office of the German embassy in Kyiv was reportedly hit - German press
(RU) Russia Pres Putin: Reiterates Ukraine is behind Crimea bridge attack; Ukraine conducted 3 attacks on Russian Kursk nuclear plant and also tried to blow up Turkstream gas pipeline
(RU) Russia Dep Chair of Security Council Medvedev (former Pres): Strikes on Ukraine today were the first episode and there will be more; Russia must work to dismantle Ukraine's political regime
DPW.DE Reports prelim Q3 EBIT €2.04B v €2.00Be; B2C volumes has improved in Q3; To raise FY22 outlook on Q3 earnings release on Nov 8th
WHO fears Monkeypox variant, Clade I virus, circulating in the Democratic Republic of the Congo could go global
Adobe forecasts US holiday season online $209.7B, up 2.5% y/y, the slowest growth since 2012; Cyber Monday forecast >$11B
PPG Reports prelim Q3 5-7% below low-end of prior $1.75-2.00 outlook (implies $1.63-1.66) v $1.82e; Sees Q4 segment earnings growth 20% with soft demand conditions in Europe, China expected to continue into Q4
(DE) Germany govt supports joint EU debt to provide loans to address energy crisis - press
(DE) German Government Member reportedly rejects earlier report that Germany backs joint EU debt for loans to ease energy crisis - press
JPM CEO Dimon: ‘This is serious’; Warns US likely to tip into recession in 6 to 9 months - CNBC
QGEN Reportedly Bio-Rad in talks to merge with Qiagen in a potential $10B+ deal - press
(US) Track maintenance workers said to have rejected labor deal with freight railroads backed by the Biden Administration - press
LEG Cuts FY22 outlook due to lower volumes; Saw home furniture demand softened significantly in the last few months
TUES 10/11
(UK) BOE: To widen scope of of daily Gilt purchases; to purchase index-linked GILTS during Oct 11-14th; Will allocate £5B to index-linked bond purchases
(FR) France Fin Min Le Maire: Negotiations need to begin in the refinery strike; otherwise the govt will intervene; Priority remains to restart EDF nuclear reactors as soon as possible
(CN) According to SCMP piece, China gives clearest sign yet it will stick with zero-Covid policy as Communist Party mouthpiece newspaper People’s Daily called for confidence and patience in China with the zero-Covid strategy - press
KLAC Said to stop some sales and services to China, including to China-based customers such as South Korea's SK Hynix and chip plants owned by Intel to comply with US export curbs - press
(JP) Japan 10-year JGB bond fails to trade for the 3rd straight session (1st time since 1999)
(RU) Russia Foreign Min Lavrov: We are willing to listen to any suggestions on possible peace talks; If US proposes Putin-Biden meeting at a forthcoming G20 meeting, we will consider it
BAC (US) BoA institute find Sep total payments +10% y/y, however evidence of housing market slowdown emerges
AAL Raises Q3 Rev +13% (prior +10-12%), TRASM +25% (prior +20-24%), CASM +14% (prior +12-14%) - filing
(SA) White House spokesperson Kirby: Pres Biden is re-evaluating relationship with Saudi Arabia after OPEC+ output cut
NLY Reports book value/shr $19.85-20.05 at Sep v $23.59 in June; Estimates cash and agency MBS liquidity position at $4.1B
(US) Dept of Labor releases proposal to force companies to reclassify independent contractors as employees
*IMF WORLD ECONOMIC OUTLOOK (WEO): CUTS 2023 WORLD OUTLOOK, WARNS 'WORST IS YET TO COME'; CUTS 2023 GDP OUTLOOKS FOR EURO AREA, UK, CHINA, LATAM
(UR) NATO Sec Gen Stoltenberg: NATO will hold planned nuclear deterrence exercises next week; What we saw yesterday is a sign of Russian weakness because Russia is not making advances on the battlefield
(US) NY Fed Survey of Consumer Expectations: Sept one year ahead expected inflation 5.4% v 5.7% m/m (lowest since Sept 2021)
MC.FR Reports Q3 Rev €19.8B v €19.1Be; Confident in continuation of current growth
(US) Fed's Mester (FOMC voter): Reiterates does not expect Fed to lower rates in 2023; Yet to make any progress on inflation
(UK) Bank of England (BOE) Gov Bailey: See serious risk to financial stability in the UK; Reiterates intervention in GILT markets will be temporary, BOE will be out by the end of the week - Washington event
(US) Fed's Mester (FOMC voter): Fed should stick to balance sheet runoff plan; Need to do more, inflation has not slowed; Fed officials aligned on where policy needs to go
INTC Said to plan thousands of jobs cuts due to PC slowdown; To focus on sales and marketing, but cuts said to be company-wide; Layoffs could be announced as early as in Oct - press
WEDS 10/12
PHIA.NL Reports prelim Q3 Rev €4.3B v €4.53Be; Sees prolonged supply chain disruptions and a worsening macro-environment; To record €1.3B goodwill impairment charge
(CN) China's Communist Party mouthpiece newspaper People’s Daily endorses zero-Covid policy for 3rd straight day; Notes it's impossible to win Covid battle by lying flat and China will stick with zero-Covid strategy to avoid huge losses arising from losing control of the epidemic
*(UK) AUG MONTHLY GDP M/M: -0.3% V 0.0%E; GDP 3M/3M: -0.3% V -0.2%E
*(UK) AUG INDUSTRIAL PRODUCTION M/M: -1.8% V -0.1%E; Y/Y: -5.2% V +0.6%E
(PL) Polish energy firm Pern detects a leak and depressurization in one line of the Druzhba oil pipeline (4-8% of total EU capacity) from Russia to Germany; Pumping of oil through the Polish line was immediately halted; Notes cause of the incident is unknown at this time
*(UK) BOE SPOKESPERSON: REITERATES STANCE THAT TEMPORARY GILT BOND-BUYING SCHEME STILL TO END ON FRI, OCT 14TH
(UR) IAEA chief Grossi: Zaporizhzhia Nuclear Power Station has lost all of its external power for the second time in five days; Again relying on diesel generators
(UR) According to Ukraine energy firm Energoatom, Russia side does not allow convoy with diesel fuel to access Zaporizhzhia Nuclear Power Station which was again cut from external power for the second time in five days
(JP) Japan 10-year JGB bond fails to trade for the 4th straight session (1st time since 1999)
PEP Reports Q3 $1.97 v $1.85e, Rev $22.0B v $20.9Be; Raises FY22 outlook; Notes global business momentum remains strong
(RU) Russia Pres Putin: Global economy is in acute crisis; Reiterates Ukrainian Special Services behind attack on Crimea bridge; It is possible to repair Nord Stream, but only if it will work - Russia Energy Week comments
(UK) PM Truss: The last thing we need is a general election; NO plans to cut public spending - House of Commons comments
BAS.DE Reports prelim Q3 Net €909M* v €1.11Be, adj EBIT €1.35B v €1.31Be, Rev €21.9B v €21.1Be; Initiates cost savings play through 2024
(JP) Bank of Japan (BOJ) Gov Kuroda: BOJ will continue easing to hit inflation target of 2% in stable and sustainable manner
(EU) ECB’s Knot (Netherlands, hawk): Need at least two more significant ECB rate hikes; Reiterates Council view that rates are way below neutral; must end accommodation phase
*(US) SEPT PPI FINAL DEMAND M/M: 0.4% V 0.2%E; Y/Y: 8.5% V 8.4%E
CABK.ES Reportedly proposes sector-wide freeze in variable mortgage costs - press
(US) Reportedly White House considering ban on Russian aluminum - press
(US) Association of American Railroads weekly rail traffic report for week ending Oct 8th: 494K total units, -2.4% y/y
(EU) ECB policymakers said to near deal to modify TLTRO rules that could reduce potential banking profits by tens of billions; Decision may come at Oct 27th meeting - press
(JP) Japan Sept PPI (CGPI) M/M: 0.7% v 0.3%e; Y/Y: 9.7% v 8.9%e
THURS 10/13
2330.TW Reports Q3 (NT$) Net 280.9B v 156.3B y/y (v 265.6Be); Op 310.3B v 171.0B y/y; Rev 613.1B v 414.7B y/y; Cuts FY22 Capex outlook
*(DE) GERMANY SEPT FINAL CPI M/M: 1.9% V 1.9%E; Y/Y: 10.0% V 10.0%E
GSK.UK GSK's older adult respiratory syncytial virus (RSV) vaccine candidate shows 94.1% reduction in severe RSV disease and overall vaccine efficacy of 82.6% in pivotal trial; Regulatory submissions based on the phase III data are anticipated in H2 2022
2330.TW CEO: Cuts FY22 Capex $36.0B (prior lower-end of $40-44B); Affirms FY22 Rev outlook; Face challenges from rising inflationary costs in 2023; Expects 2023 to be a growth year for TSMC
(CN) China senior health advisor official Liang: Dynamic zero-Covid policy in the past three years has proven to be effective, feasible and scientific; China must continue with zero-Covid policy
(NO) Norway's natural gas processing plant Nyhamna reportedly has been evacuated; Norwegian police responding to 'unclear situation'; Norway gas system operator Gassco notes gas transport and production are not disturbed - Norwegian press
IEA Monthly Oil Report (OMR): EU yet to replace more than half of pre-war Russian oil imports
(UR) EU Foreign Policy Chief Borrell: Nuclear attack against Ukraine will trigger not a retaliatory nuclear, but a powerful military response
(BE) ECB's Wunsch (Belgium, hawk): Rate seen around 2% by end-2022; would not be surprised if rates went above 3.0% - CNBC interview
BLK Reports Q3 $9.55 v $7.93e, Rev $4.31B v $4.41Be
DAL Reports Q3 $1.51 adj v $1.56e, Rev $14.0B v $14.2Be; Working toward full network restoration by summer 2023
(UK) PM Spokesman Blain: UK tax position has not changed; PM Truss has full confidence in the OBR's ability to forecast accurately
FAST Reports Q3 $0.50 v $0.48e, Rev $1.80B v $1.79Be; Did not take any broad pricing actions in Q3
RLMD Reports top-line results from Phase 3 RELIANCE III trial for REL-1017 as a monotherapy for treatment of major depressive disorder; Paradoxical results observed in certain study sites, where placebo dramatically outperformed REL-1017; RELIANCE I and II Adjunctive MDD trials continue to advance
(UK) Sky News reports that some UK govt officials discussing which part of mini budget might be dropped
*(US) SEPT CPI M/M: 0.4% V 0.2%E; Y/Y: 8.2% V 8.1%E (annual pace records 3rd straight decline); Core CPI Y/Y highest since 1982
Redfin: Asking rents rise 9% y/y in Sep, slowest growth since August 2021
(RU) Kremlin spokesperson: The goals of the 'special operation' in Ukraine are unchanged, but they can be achieved through negotiations - Russian press
(LT) ECB's Simkus (Lithuania): Favors 75 basis point hike this month along with discussion around TLTRO requirements; Do not see financial instability
(US) Atlanta Fed Sep Sticky-CPI annualized 8.5% v 7.7% m/m, core 8.3% v 7.5% m/m (40-year high)
*(US) DOE CRUDE: +9.9M V +1ME; GASOLINE: +2.0M V -1ME; DISTILLATE: -4.9M V -1.5ME
AAPL Announces new high-yield savings account for Apple Card from Goldman Sachs
*(US) TREASURY $18B 30-YEAR BOND REOPENING DRAWS 3.930% V 3.511% PRIOR; BID TO COVER 2.39 V 2.42 PRIOR AND 2.35 OVER LAST 8 REOPENINGS (Highest yield since 2011)
*(SG) SINGAPORE Q3 ADVANCED GDP Q/Q: 1.5% V 0.7%E; Y/Y: 4.4% V 3.5%E
*(CN) CHINA SEPT CPI M/M: 0.3% V 0.4%E; Y/Y: 2.8% V 2.9%E [fastest annual pace since Apr 2020]
FRI 10/14
IDS.UK Trading update: prelim H1 adj Op -£219M v +£235M y/y; Could cut up to 6,000 jobs by Aug 2023; Urges CWU to immediately call off planned strike; All options remain open, including separation of the two companies
(RU) Reports circulating that a NOTAM** notice was issued for large parts of Russia's Kara Sea for Oct 17-22nd
(US) Pres Biden to sign an executive order on Oct 14th pushing federal officials to drive prescription drug costs down - press
(UK) CHANCELLOR OF THE EXCHEQUER (FIN MIN) KWARTENG CONFIRMS TO STEP DOWN - TWEET
JPM Reports Q3 $3.12* v $2.97e, Managed Rev $33.5B v $32.3Be; Expects to reach current target CET1 ratio of 13% in Q1 2023; Hopes to resume buybacks early 2023
JPM Raises FY22 NII $61.5B (prior $58B+) v $44.5B y/y; Adj expense $77B (prior $77B) v $71B y/y - earnings slides
ACI Confirms to be acquired by Kroger for $34.10/shr in cash plus special dividend of ~$6.85/shr valued at EV of $24.6B; To establish subsidiary (SpinCo) as standalone company prior to merger closure
(RU) Russia Pres Putin: No need for massive strikes on Ukraine now, No plans for additional mobilization in Russia
C Reports Q3 $1.63 v $1.55e, Rev $18.5B v $18.4Be
(UK) PM Truss: Confirms will keep corporation tax rise to 25% (from 19%), Clear that parts of the mini-budget went too far
(US) SEPT ADVANCE RETAIL SALES M/M: 0.0% V 0.2%E; RETAIL SALES (EX-AUTO) M/M: +0.1% V -0.1%E
(US) OCT PRELIMINARY UNIVERSITY OF MICHIGAN CONFIDENCE: 59.8 V 58.8E; 1 year inflation expectations 5.1% v 4.6%e

(US) Fed's Daly (non-voter): The latest CPI was very disappointing but not surprising, 4.5-5% most likely top FED funds rate, will hold there