- Asian Stocks Shift Higher in Rollercoaster Trade: Markets Wrap
(Bloomberg) — Asian stocks resumed gains after an early bout of selling, in a sign that investors are still assessing the market’s outlook after the recent wild swings in global assets. Japanese shares pared losses at the open, led by a rebound in financial firms. South Korea’s benchmark also rose. - Dow closes nearly 300 points higher to snap three-day losing run in broad relief rally
Stocks jumped Tuesday, recovering some losses from the previous three trading days as investors took a pause from recession fears and Japanese equities rallied. The Dow Jones Industrial Average rose 294.39 points, or 0.76%, to end at 38,997.66. The S&P 500 advanced 1.04%, closing at 5,240.03. The tech-heavy Nasdaq Composite gained 1.03% to settle at 16,366.85. The major averages snapped a three-day stretch of losses. - Oil edges lower on surprise build in U.S. crude and gasoline stocks
Oil prices slipped in early Asian trading on Wednesday following a brief rebound in the previous session after industry data showed an unexpected build in U.S. crude oil and gasoline inventories, offsetting global oil supply concerns. Brent crude futures fell 21 cents, or 0.27%, to $76.27 a barrel by 0020 GMT. U.S. West Texas Intermediate crude slipped 25 cents, or 0.34%, to $72.95 per barrel. U.S. crude oil, gasoline and distillate inventories rose last week, according to market sources citing American Petroleum Institute figures on Tuesday. - Gold eases as dollar, yields firm; Fed rate cut hopes lend support
Gold prices eased on Tuesday on dollar strength and higher bond yields, although expectations of a U.S. rate cut in September and escalating geopolitical tensions in the Middle East kept bullion stable following last session’s sharp retreat. Spot gold last fell 0.80% to $2,388.34 per ounce. The metal fell 1.5% in the previous session, driven by global sell-off as fears of the U.S. tipping into recession lingered. U.S. gold futures settled 0.5% lower to $2,431.60 The dollar index was up 0.25%, in its first day trading higher against the Japanese currency this month, making greenback-priced bullion less affordable for overseas buyers. - Hedge Funds Were Hit by Tech-Stock Losses Before Latest Selloff
(Bloomberg) — As a stock rout hit markets mid-July, some of the world’s biggest equity hedge funds lost hundreds of millions of dollars from piling into popular tech stocks that led the meltdown. Worst hit were Glen Kacher’s Light Street Capital Management, Bill Ackman’s Pershing Square Capital Management and Philippe Laffont’s Coatue Management. - Goldman Says Hedge Funds Bought US Stocks Amid Monday’s Rout
(Bloomberg) — As volatility gripped global markets to start the week, hedge funds stepped in to buy the big dip in technology shares, according to Goldman Sachs Group Inc.’s prime brokerage data. The S&P 500 Index suffered its worst rout in almost two years on Monday. - Sahm rule creator doesn’t think that the Fed needs an emergency rate cut
The U.S. Federal Reserve does not need to make an emergency rate cut, despite recent weaker-than-expected economic data, according to Claudia Sahm, chief economist at New Century Advisors. While the Fed is intentionally putting downward pressure on the U.S. economy using interest rates, Sahm warned the central bank needs to be watchful and not wait too long before cutting rates, as interest rate changes take a long time to work through the economy. - EV Fund Outflows Hit $1.6 Billion as Trump Fears Add to Slowdown
(Bloomberg) — Investors are rushing out of electric vehicle-focused funds as growth forecasts cool and with a potential reelection of Donald Trump seen posing a further challenge to profits. EV funds tracked by data provider EPFR Global had combined net outflows of $1.6 billion this year to July 31, more than the total redemptions in 2023. - Harris, Walz Launch Swing-State Blitz to Gain Edge Over Trump
(Bloomberg) — Vice President Kamala Harris kicked off a critical campaign stretch aimed at putting Republican Donald Trump on the defensive in key swing states as she took the stage for the first time with her new running mate, Minnesota Governor Tim Walz. Harris personally introduced Walz on stage, hailing him as a fighter for the middle class. - Hamas Makes Sinwar Political Chief, Undercutting Cease-Fire Hope
(Bloomberg) — Hamas named Yahya Sinwar, the alleged mastermind of the group’s Oct. 7 assault, as its new political leader, the latest blow to multilateral efforts to reach a cease-fire agreement in Gaza. Sinwar succeeds Ismail Haniyeh, a key mediator whose assassination in Iran last week had already put strain on talks aimed at bringing the 10-month-old war to an end. - Volatile Markets Add to Pressure on Fed and Peers to Ease Stance
(Bloomberg) — In a year that’s seen central banks weighing the risk of inflation staying too high against the chance of tipping economies into recession, policymakers now have a fresh dynamic to consider: volatile financial markets. Initial reactions around the world to the mass selloff in equities on Monday showed that officials were hardly getting spooked. - Traders Are Starting to Cash In on Bets for Bigger Fed Rate Cuts
(Bloomberg) — US Treasuries are at risk of a further selloff as traders in the futures and options markets cash in on their bets for aggressive Federal Reserve interest-rate cuts this year. After piling into Treasury futures contracts at a rate not seen since 1982, according to CME Group Inc. data, traders are starting to pull back on their dovish bets. - Nobel Winner Yunus to Lead Bangladesh After Shunning Politics
(Bloomberg) — Bangladesh is pinning its hopes on one of the nation’s most acclaimed intellectuals to bring stability to a country scarred by coups and political upheaval. Muhammad Yunus, whose work alleviating poverty won him a Nobel Peace Prize, was named the head of a new interim government on Tuesday following the sudden ouster of Sheikh Hasina as prime minister. - Japan Spent $68 Billion to Prop Up Yen Twice in Second Quarter
(Bloomberg) — Japan stepped into the foreign exchange market twice between April and June, according to a report on the government’s record intervention earlier this year. The Ministry of Finance conducted currency interventions on April 29 and May 1, as detailed in the daily operational report released Wednesday for the quarter ended June. - Bond Yields Up on Speculation of State Bank Sales: Inside China
(Bloomberg) — China’s bond yields rose for a second day amid speculation that state banks sold government notes on Monday. The offshore yuan trades steady. China’s 10-year bond yield up 1bp at 2.16%, highest since July 26 and extending Monday’s advance; Futures contracts on 10-year notes fell 0.3% to 106.205, the most since July 8. - Caterpillar shares rose 3% after the company said its annual profit will probably be higher than previously expected. The company also reported second-quarter earnings that showed resilience despite growing worries about the global economy
Caterpillar said full-year adjusted profits will now be higher than previously forecast and profit margins will top its target range, while warning that sales are expected to be slightly lower. The company has been benefiting from strong prices and lower-than-expected manufacturing costs which have supported profit margins, executives said. Still, sales are expected to end slightly lower for the year and the pricing environment is expected to normalize in the second half, especially in construction. Caterpillar is now expecting a slight reduction in machine dealer inventories for the year. The company says it should continue to benefit from favorable costs. - Uber Technologies rose 10.9% after it reported better-than-expected orders in the second quarter, underscoring the continued strength in demand for rideshare and delivery services
Gross bookings, which includes ride hails, delivery orders and driver and merchant earnings but not tips, grew 19% to $39.95 billion in the three months ended June 30. Analysts were expecting $39.7 billion. Uber’s adjusted earnings before interest, taxes, depreciation and amortization were $1.57 billion, ahead of the $1.5 billion that Wall Street was projecting. Gig-economy companies such as Uber and rival DoorDash Inc. both said their healthy bookings indicated inflation wasn’t stopping consumers from spending on deliveries. - Shares of Airbnb Inc. tumbled 16.6% afterhours, after the company gave a disappointing outlook for a third consecutive quarter and warned of slowing demand from US vacationers, a sign that travel momentum is tapering off despite the peak summer season
Airbnb expects “sequential moderation” of growth in the key measure of nights and experiences booked during the current period. Airbnb posted an 8.7% gain in that category during the second quarter, falling short of investors’ estimates. And the third-quarter increase will be even smaller. Analysts had been projecting an 11% boost. This sets up the slowest pace of growth since 2020 following an especially brisk vacation season in 2023. Even as the pandemic retreats, headwinds have dogged the broader industry. Last week, Booking Holdings Inc. gave worse-than-expected guidance, blaming “mild moderation” in the European travel market and “mild indication” of some consumers opting for lower-star hotels and shorter stays, particularly in the US. - Palantir shares jumped 10.38%, after it reported second quarter earnings and raised its full-year forecast, citing continued demand for the company’s artificial intelligence software
For the second quarter, revenue came in at $678.1 million, beating estimates of $652.8 million. Adjusted earnings per share was at 9 cents, beating estimates of 8.10 cents. For the year ahead, Palantir forecasted a revenue between $2.74 billion to $2.75 billion, while estimates were at $2.7 billion. - Super Micro Computer fell 13.3% in afterhours trading after reporting quarterly revenue and profit that missed analysts’ estimates, outweighing an annual sales outlook that was billions above Wall Street projections
Profit, excluding some items, was $6.25 a share in the period ended June 30. That’s short of Super Micro’s previous forecast and the $8.25 average analyst estimate. Sales were $5.31 billion, compared with an average projection of $5.32 billion. A jump in demand for the equipment that powers artificial intelligence software has helped drive sales at Super Micro, which makes data center servers. The company forecast revenue of $26 billion to $30 billion in the fiscal year ending June 30, 2025. Analysts, on average, estimated $23.6 billion. - Wegovy maker Novo Nordisk posts earnings miss, cuts operating profit outlook
Novo Nordisk on Wednesday posted weaker-than-expected net profit in the second quarter and trimmed its operating profit outlook. The pharmaceutical giant said its net profit came in at 20.05 billion Danish kroner ($2.93 billion) in the three months to the end of June. A LSEG aggregate forecast had projected the figure would come in at 20.9 billion Danish kroner. In the first quarter of 2024, the Wegovy maker had posted a net profit increase of 28% to 25.4 billion Danish kroner year on year, it said in May. - Consumer giants from Starbucks to General Mills have one big sales problem: China
Starbucks reported China same-store sales dropped by 14% in the quarter ended June 30, far steeper than the 2% decline in the U.S. “Consumer sentiment in China is quite weak,” McDonald’s chairman, CEO and director Christopher Kempczinski, said of the quarter ended June 30. After a “strong start” to the year in China, General Mills CFO Kofi Bruce said the quarter ending May 26 “saw a real souring or downturn in consumer sentiment.” - Reddit reports better-than-expected results for second quarter as digital ad market improves
Reddit reported second-quarter results on Tuesday that topped analysts’ estimates. Here’s how the company did compared to LSEG estimates: Loss per share: 6 cents vs. a loss of 33 cents, revenue: $281 million vs. $254 million expected. Sales in the second quarter rose 54% from a year earlier. The company’s net loss narrowed to $10.1 million from $41.1 million in the same quarter a year earlier. Online advertising revenue climbed 41% from a year prior to $253.1 million. The digital ad market is continuing to recover from a tough 2022, when businesses pulled back on promotional spending because of inflation and other factors. - Rivian tops Wall Street’s second-quarter expectations amid cost cuts
Rivian Automotive beat Wall Street’s top- and bottom-line expectations for the second quarter as the electric vehicle maker continues to take costs out of its business. Here is how the company did, compared to estimates from analysts polled by LSEG: Earnings per share: Loss of $1.13 adjusted vs. loss of $1.21 expected, automotive revenue: $1.16 billion vs. $1.14 billion expected. The company’s net losses widened during the second quarter to $1.46 billion, or a loss of $1.46 per share, compared with a year earlier of $1.2 billion, or a loss of $1.27 per share. - Disney raises streaming prices for Hulu, Disney+ and ESPN+
Disney is raising prices on its streaming platforms. Starting mid-October, most plans for Disney+, Hulu and ESPN+ will cost $1 to $2 more per month, according to a press release Tuesday. The most expensive plans for Hulu, which include live TV, will cost $6 more per month. Disney+ basic and premium will be priced at $9.99 and $15.99, respectively. Hulu with ads will cost $9.99 monthly, while Hulu without adds will cost $18.99 per month. ESPN+, which features ads, will cost $11.99 per month. - Elon Musk will interview Trump on Monday night, Republican presidential nominee says
Republican presidential nominee Donald Trump said he will be interviewed by Elon Musk, the billionaire CEO of Tesla and SpaceX. The former president’s planned talk with Musk comes on the heels of Democratic presidential nominee Kamala Harris selecting Minnesota Gov. Tim Walz as her running mate. Officials in several states are eyeing a Trump-supporting political action committee that Musk says he created, due to its failure to help website users register to vote as promised. - Microsoft fires back at Delta after massive outage, says airline declined ‘repeated’ offers for help
Microsoft’s lawyer said CEO Satya Nadella emailed Delta CEO Ed Bastian but didn’t receive a reply. The disruptions cost the airline some $500 million, Bastian told CNBC last week, announcing the company would seek damages. A lawyer representing Microsoft said a key crew-scheduling system that failed was being serviced by other technology companies, including IBM. - Kenvue Inc., the owner of the Tylenol and Neutrogena brands, jumped 14.7% after reporting sales that topped estimates, bucking a trend among its peers
Organic sales rose 1.5% in the quarter ended June 30, driven by higher prices. That compares with an estimate for a 1.1% decline, according to the average estimate. The results stand out from peers, including Procter & Gamble Co., which recently reported quarterly sales that missed expectations. Shoppers are under increasing financial pressures and cutting back, but still spending on certain goods. Kenvue’s volume declines were driven by its US skincare business, which has struggled amid rising competition. Organic growth in the unit fell 2.4% from a year earlier. - Nomura’s Willcox Says BOJ Vindicated as Carry Trades Unwind
(Bloomberg) — The Bank of Japan’s decision to raise interest rates last week was appropriate and the disruption to financial markets from unwinding of carry trades would have been much bigger had it waited longer, a senior Nomura Holdings Inc. executive said.
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