Traders Market Weekly: Santa Claus Came to Town

Viewing 15 posts - 76 through 90 (of 97 total)
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    Equity indices in the Asia-Pacific region were little changed on Friday with the exception of Hong Kong’s Hang Seng Index (-1.8%).

    Japan’s Nikkei: flat (+0.5% for the week),
    Hong Kong’s Hang Seng: -1.8% (-4.2% for the week),
    China’s Shanghai Composite: -0.1% (-0.9% for the week),
    India’s Sensex: +0.3% (-0.5% for the week),
    South Korea’s Kospi: flat (+1.4% for the week),
    Australia’s All Ordinaries: flat (+0.9% for the week).

    Gaming stocks like Tencent and Netease plunged on a Reuters report that Chinese regulators are toughening oversight that includes setting spending limits and curtailing rewards programs for online video gaming.


    Japan’s National Core CPI was up 2.5% yr/yr in November, as expected, marking the lowest annual pace since July 2022.
    November National CPI 2.8% yr/yr (last 3.3%) and National Core CPI 2.5% yr/yr (expected 2.5%; last 2.9%)

    The minutes from the Bank of Japan meeting note that officials don’t see certainty yet with meeting inflation target.


    November Private Sector Credit 0.4% (last 0.3%); November Housing Credit 0.4% (last 0.4%)


    Major European indices are effectively flat in today’s trade, reflecting a lack of conviction and an increase in distraction going into the extended holiday weekend.
    STOXX Europe 600: flat (flat for the week),
    Germany’s DAX: flat (-0.3% for the week),
    UK’s FTSE 100: +0.1% (+1.7% for the week),
    France’s CAC 40: flat (-0.3% for the week),
    Italy’s FTSE MIB: flat (-0.3% for the week),
    Spain’s IBEX 35: flat (+0.1% for the week).

    Markets will be closed Monday for Christmas Day and then most European markets will be closed Tuesday as well for Boxing Day.
    There was a good bit of data released today, including the UK’s final Q3 GDP report, which was revised lower to show a small contraction (-0.1%) in activity.
    Separately, some weakness in consumer discretionary stocks, like Adidas and Puma, was seen following Nike’s earnings report and disappointing guidance.


    November Import Price Index -0.1% m/m (expected -0.4%; last 0.3%) and -9.0% yr/yr (last -13.0%)

    Q3 GDP -0.1% qtr/qtr (expected 0.0%; last 0.2%) and 0.3% yr/yr (expected 0.6%; last 0.6%);
    November Retail Sales 1.3% m/m (expected 0.4%; last -0.3%) and 0.1% yr/yr (expected -1.8%; last -2.5%);
    Core Retail Sales 1.3% m/m (expected 0.0%; last 0.2%) and 0.3% yr/yr (last -2.1%);
    Q3 Business Investment -3.2% qtr/qtr (expected -4.2%; last 1.4%) and 2.3% yr/yr (expectd 2.8%; last 8.0%);
    Q3 Current Account GBP -17.2B (expected GBP -13.1B; last GBP -24.0B)

    December Consumer Confidence 89 (last 88); November PPI 2.4% m/m (last -0.1%) and 0.3% yr/yr (last -1.4%)

    December Consumer Confidence 106.7 (expected 103.8; last 103.6); December Business Confidence 95.4 (last 96.6)

    Q3 GDP 0.3% qtr/qtr (expected 0.3%; last 0.5%) and 1.8% yr/yr (expected 1.8%; last 2.2%)


    AAR Corp (AIR 69.37, -1.42, -2.0%): beats by $0.01, misses on revs

    Mission Produce (AVO 9.48, -0.09, -0.9%): beats by $0.01 (two ests), misses on revs (two ests); expects Q1 volumes to be slighter lower yr/yr and prices to be higher


    NIKE (NKE 107.73, -14.80, -12.1%): beats by $0.19, reports revs in-line, gross margin increased 170 bps, inventories down 14%; announces enterprise initiative targeting up to $2 bln in cost savings over three-year period


    C.H. Robinson (CHRW 86.36, +0.51, +0.6%): announces retirement of Mike Zechmeister as CFO; he will remain with the co until a successor is named or no later than May 31, 2024


    Karuna Therapeutics (KRTX 315.00, +99.81, +46.4%): confirms it will be acquired by Bristol-Myers (BMY) for $330.00/share in cash, for a total equity value of $14.0 bin


    Rocket Lab (RKLB 4.97, +0.54, +12.2%): USA enters into agreement with a U.S. Government customer to manufacture 18 space vehicles; total value of $515 mln


    S&P 500 futures are down 3 points and are trading 0.1% below fair value,
    Nasdaq 100 futures are down 11 points and are trading 0.1% below fair value,
    Dow Jones Industrial Average futures are down 131 points and are trading 0.3% below fair value.

    Markets will be closed on Monday for Christmas Day.

    The 2-yr note yield is unchanged from yesterday at 4.33% and the 10-yr note yield is down four basis points to 3.85%.


    Personal income increased 0.4% month-over-month in November, as expected, following an upwardly revised 0.3% increase (from 0.2%) in October. Personal spending was up 0.2%, also as expected, following a downwardly revised 0.1% increase (from 0.2%) in October.

    The PCE Price Index declined 0.1% month-over-month (consensus 0.1%), taking the year-over-year change to 2.6% from 2.9% in October. That was the first decline in the PCE Price Index since 2020. The core PCE Price Index, which is the Fed’s preferred inflation gauge, increased 0.1% month-over-month (consensus 0.2%), taking the year-over-year change to 3.2% from 3.4%.

    The key takeaway from the report is that it threads the needle for a Fed aiming to bring down inflation with higher rates, but not tank the economy in the process. The 0.3% month-over-month jump in real PCE combined with a 0.4% increase in real disposable personal income and the disinflation in the PCE Price Indexes is the stuff that soft landings/no landings are made of.

    First Decline in PCE Prices since 2020, Soft Landing Case Boosted by Real Disposable Personal Income


    Durable goods orders surged 5.4% month-over-month in November (consensus 2.5%) following an upwardly revised 5.1% decline (from -5.4%) in October. Excluding transportation, durable goods orders were up 0.5% month-over-month ( consensus 0.2%) following a downwardly revised 0.3% decline (from 0.0%) in October.

    The key takeaway from the report was found in the reading for nondefense capital goods orders excluding transportation — a proxy for business spending. It was up 0.8% month-over-month on the heels of a 0.6% decline in October, connoting a welcome reacceleration in order activity that will mesh with a soft landing outlook.


    The final reading for the University of Michigan Consumer Sentiment Index for December came in at 69.7 (consensus 69.7) versus the preliminary reading of 69.4. That was up nicely from the final reading of 61.3 for November, and it marked a recovery of all declines from the previous four months. In the same period a year ago, the index stood at 59.8.

    The key takeaway from the report is the linkage between the increase in sentiment and the decrease in inflation expectations. The latter set the tone for improved attitudes across age, income, education, geography, and political identification.


    New home sales decreased 12.2% month-over-month in November to a seasonally adjusted annual rate of 590,000 units (consensus 689,000) from a downwardly revised 672,000 (from 679,000) in October. On a year-over-year basis, new home sales were up 1.4%.

    The key takeaway from the report is that new home sales activity slumped badly in November, paced by the largest region for new home sales (the South) where prices are generally more affordable. The weakness speaks to supply constraints for lower-priced homes and general affordability constraints created by high mortgage rates and high prices relative to median prices for existing homes.

    US New Home Sales Slump 12.2% in November, South Down 20.9% on Supply

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