- Japan Leads Asian Stock Selloff, Yen Resumes Climb: Markets Wrap
(Bloomberg) — Japanese stocks fell alongside Asian equities Thursday, continuing a bout of volatile trading as
investors digest signals from central banks on the path ahead for interest rates. The Topix Index opened
lower alongside benchmarks in Australia and South Korea. US futures also fell in early Asian trading Thursday. - Stocks close lower on Wednesday as market’s comeback attempt fizzles out
Stocks closed lower on Wednesday as the market’s attempt to fully recover from Monday’s sell-off failed.
The Dow Jones Industrial Average fell 234.21 points, or 0.60%, to 38,763.45. The S&P 500 declined 0.77% and
ended at 5,199.50, while the Nasdaq Composite dropped 1.05% to close at 16,195.81. At session highs, the
Dow surged 480.30 points, while the S&P 500 jumped 1.73%. The tech-heavy Nasdaq was up more than 2%
at one point. - Oil prices tick up on sharp fall in U.S. crude inventories
Oil prices edged higher on Thursday for the third straight session after government data showed a steep
draw in U.S. crude stockpiles, rebounding from multi-month lows touched this week. Brent crude
futures rose 23 cents, or 0.3%, at $78.56 a barrel by 0017 GMT, while U.S. West Texas Intermediate
crude gained 29 cents, or 0.4%, to $75.52. Brent tumbled to its weakest since early January on Monday, and
WTI dipped to its lowest since February, hurt by worry over a U.S. recession and a selloff in global stocks. - Gold buoyed by Fed rate-cut hopes, geopolitical concerns
Gold prices firmed on Wednesday on mounting bets of U.S. interest rate cuts in September and rising
geopolitical tensions in the Middle East, with markets awaiting U.S. economic data for clues on the Federal
Reserve’s interest rate path. Spot gold rose 0.4% to $2,399.38 per ounce, as of 11:29 a.m. ET (1529 GMT).
U.S. gold futures gained 0.3% to $2,438.80. Bullion prices fell as much as 3% on Monday, caught in a global
sell-off driven by fears of a U.S. recession. - Hedge Funds 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. - Hedge Funds Cut Tesla Short Bets Before Earnings: ESG Investing
(Bloomberg) — Hedge funds trimmed their short bets against Tesla Inc. as the electric vehicle maker unveiled
a quarterly earnings report that triggered its biggest share-price slump in almost four years.
Some 16.3% of the 500-plus hedge funds tracked by data provider Hazeltree had an overall short position on
Tesla the week before the report. - JPMorgan Says 75% of Carry Trades are Closed, YTD Return Wiped
(Bloomberg) — Three quarters of the carry trade has been unwound as the recent slump wiped out all
positive year-to-date returns, according to JPMorgan. Losses in G10, EM and global carry baskets have been
ongoing since May with a drawdown of around 10%, erasing this year’s positive return and significantly
cutting into returns since end-2022. - China’s exporters enjoyed the benefits of a weak yuan. Now that’s changing and cutting into profits
The offshore yuan traded in Hong Kong surged Monday against the U.S. dollar to its strongest level for 2024
below 7.1 before weakening slightly to around 7.18 as of Wednesday afternoon, according to Wind
Information. Many trade companies, especially smaller ones, have currently adopted a strategy of preferring
not to take orders rather than take loss-making orders, Winnie Wang, president of the Shenzhen CrossBorder E-Commerce Association, said Tuesday in Chinese, according to a CNBC translation. Apart from
geopolitical reasons, Chinese companies are increasingly focused on hedging currency risk because they are
localizing operations globally. - Apple could charge up to $20 for some Apple Intelligence AI features, analysts say
Apple could charge its users up to $20 for its advanced artificial intelligence features, analysts told CNBC, as
the company looks to boost the growth of its lucrative services business. The Cupertino giant plans to rollout
Apple Intelligence, its forthcoming AI system, across some of its devices later this year. It is not unusual for
technology firms to charge for their AI offerings. OpenAI, for example, has a subscription fee for more
advanced ChatGPT features and Microsoft charges for its AI Copilot tool. - Banks face tough new security standards in the EU their tech suppliers are under scrutiny, too
By January 2025, banks and their technology suppliers will have to comply with a new EU law known as
DORA. It could help prevent major IT disruptions in future. The importance of financial firms reducing risks
stemming from third-party tech vendors became more pronounced after a faulty CrowdStrike software
update caused widespread global tech outages. - BOJ Didn’t See July Hike as Policy Tightening, Summary Shows
(Bloomberg) — A summary of opinions from the Bank of Japan’s July 31 board meeting showed that
authorities believed monetary policy would remain accommodative even as they conducted a small interest
rate hike. It should be noted that raising the rate at a moderate pace means an adjustment in the degree of
monetary accommodation in accordance with underlying inflation. - Harris Rides Momentum in Midwest as Vance Eyes Air Force Two
(Bloomberg) — Vice President Kamala Harris and her new running mate, Minnesota Governor Tim Walz, took
their campaign to crucial Midwest swing states to sell voters on their economic message, an effort Donald
Trump’s running mate, JD Vance, sought to undercut. - JPMorgan Boosts US Recession Chance to 35% by End of This Year
(Bloomberg) — JPMorgan Chase & Co. now sees a 35% chance that the US economy tips into a recession by
the end of this year, up from 25% as of the start of last month. US news hints at a sharper-than-expected
weakening in labor demand and early signs of labor shedding, JPMorgan economists led by Bruce Kasman
wrote in a note to clients Wednesday. - Fed Moving Aggressively on Rate Cuts May Spur PBOC to Ease More
(Bloomberg) — The People’s Bank of China is potentially getting the respite it’s been hoping for from global
financial markets, bringing closer a dose of monetary stimulus long awaited by investors and traders. - Stocks Swoon After Weak $42 Billion Treasury Sale: Markets Wrap
(Bloomberg) — The rapid slide in US stocks that followed a weak $42 billion sale of Treasuries underscored
the fragility of global financial markets in the wake of historic volatility. After an equity surge driven by the
Bank of Japan’s dovish signals, the S&P 500 wiped out its gains. - Brookfield Asset Profit Misses, Assets Hit About $1 Trillion
(Bloomberg) — Brookfield Asset Management Ltd. said its assets under management rose to a record of
approximately $1 trillion, and it reported profit that increased from a year ago but still missed analysts’
expectations. During the quarter, we raised a total of $68 billion, Chief Executive Officer Bruce Flatt and
President Connor Teskey said in a letter to investors. - BHP Is Said to Seek Buyer for Gold, Copper Mines in Brazil
(Bloomberg) — BHP Group Ltd., the world’s No. 1 miner, is planning to sell Brazilian copper and gold assets it
acquired with the takeover of Oz Minerals Ltd., according to people familiar with the matter. The company’s
acquisition of Oz Minerals in May 2023 was its biggest deal in more than a decade and included buying an
untapped gold deposit and four small. - Market Chatter: Millers to Partner with BOCHK to Accept Digital Yuan at 300 Hong Kong Outlets
BOC Hong Kong (HKG:2388) will partner with retailer Mannings to help customers use digital yuan for
payments in their 300 stores in Hong Kong, The Standard reported Thursday. Merchants can accept the
payments by scanning the buyer’s digital yuan payment code. - Novo Nordisk A/S shares fell 6.7% after the drugmaker reported disappointing sales of its blockbuster
weight-loss treatment Wegovy
Revenue from the drug was hit by higher-than-expected price concessions to US managers of pharmacy
benefits in the latest quarter, Chief Financial Officer Karsten Knudsen said. He called it a one-time factor, but
the size of the shortfall raised concerns among investors about growing pricing pressure as Eli Lilly &
Co. muscles in with its rival product. Second-quarter sales of Wegovy were 11.7 billion Danish kroner, $1.7
billion, while the average estimate was 13.7 billion kroner. Novo is vying with Lilly for supremacy in the
pharmaceutical industry’s fastest-growing new business, obesity drugs. The market is expected to reach $130
billion by the end of the decade. - Amgen shares fell 5% after the drugmaker reported second-quarter results that underwhelmed Wall
Street. The company also said it planned to increase capital spending on its obesity asset, though it didn’t
provide any new data on the closely watched compound
SECOND QUARTER RESULTS: Adjusted EPS $4.97 vs. $5 y/y, estimate $4.98. Revenue $8.39 billion, +20% y/y,
estimate $8.34 billion. Product sales $8.04 billion, +20% y/y, estimate $8.03 billion. Adjusted operating
income $3.87 billion, +10% y/y, estimate $3.83 billion. Adjusted operating margin 48.2% vs. 52.6% y/y. YEAR
FORECAST: Sees adjusted EPS $19.10 to $20.10, saw $19 to $20.20, estimate $19.51. Sees revenue $32.8
billion to $33.8 billion, saw $32.5 billion to $33.8 billion, estimate $33.04 billion. Sees capital expenditure
about $1.3 billion, saw about $1.1 billion. Still sees share buyback up to $500 million. - Shopify reported second-quarter sales and profit that beat estimates, showing that the e-commerce
company is managing to navigate cautious consumer spending. Shares surged 17.8%
Revenue for the period came in at $2.05 billion, up about 21% year-over-year and beating the $2 billion
average estimate. Profit, excluding one-time items, was 26 cents a share, above the 20 cents expectation.
Percentage revenue growth for the current quarter ending in September will be in the low to mid-twenties
on a year-over-year basis, Shopify said. Analysts were looking for 21% growth. Shopify has been struggling
with slowing revenue growth in recent quarters. In an effort to kick-start growth, President Harley Finkelstein
pledged to invest heavily in marketing even if doing so crimps profit margins. - CVS Health lowered its 2024 earnings outlook for the third straight quarter and announced cost-cutting
measures to save $2 billion over several years as health-care expenses continue to soar
The company also announced the departure of Brian Kane, who took the helm as the president of the Aetna
insurance unit just under a year ago. CVS Chief Executive Officer Karen Lynch and Chief Financial Officer Tom
Cowhey will temporarily take over his duties during the search for a successor. CVS is slashing spending and
streamlining operations as its insurance arm faces pressure from rising US medical costs. Aetna accounts for
about a third of the company’s revenue, but its struggles this year are largely to blame for a downturn in
earnings and slump in the stock price. Adjusted earnings for the year will be in the range of $6.40 to $6.65 a
share, down from the earlier forecast of at least $7 a share, CVS said. Cash flow from operations will be about
$9 billion, a drop from its previous estimate of at least $10.5 billion. - Emerson Electric fell 7.6% after cutting its earnings per share forecast for the full year and narrowing its
adjusted EPS estimate
THIRD QUARTER RESULTS: Adjusted EPS $1.43, estimate $1.41. Underlying revenue Y/y % +3%, estimate
+4.13%. Net sales $4.38 billion, estimate $4.41 billion. Underlying sales +3%, estimate +4.13%. YEAR
FORECAST: Sees adjusted EPS $5.45 to $5.50, saw $5.40 to $5.50, estimate $5.47. Sees EPS $2.82 to $2.87,
saw $2.98 to $3.08. Sees net sales about +15%. Sees underlying sales about +6%, estimate +6.31%. Sees
operating cash flow about $3.2 billion, saw about $3.1 billion. Sees free cash flow about $2.8 billion, saw
about $2.7 billion. - Hilton Worldwide shares dipped 1.7% after the hotel operator posted better-than-expected earnings
per share in the second-quarter earnings while its full-year guidance missed the average estimate
SECOND QUARTER RESULTS: Adjusted EPS $1.91 vs. $1.63 y/y, estimate $1.85. Revenue $2.95 billion, +11%
y/y, estimate $2.93 billion. System-wide comparable revPAR +3.5%. System-wide ADR $163.70, +0.1% y/y,
estimate $165.64. System-wide occupancy 75.3% vs. 74.6% y/y, estimate 75.4%. Total location count 7,780,
+6.6% y/y, estimate 7,742. Total rooms at end of period 1.22 million, +6.2% y/y, estimate 1.22 million.
Adjusted Ebitda $917 million, +13% y/y, estimate $902.2 million. Adjusted Ebitda margin 72.2% vs. 69.3% y/y,
estimate 70.9%. Adjusted net income $481 million, +11% y/y, estimate $464.9 million. YEAR FORECAST: Sees
adjusted EPS $6.93 to $7.03, saw $6.89 to $7.03, estimate $7.09. Sees system-wide comparable revPAR +2%
to +3%, saw +2% to +4%. Sees adjusted Ebitda $3.38 billion to $3.41 billion, saw $3.38 billion to $3.43 billion,
estimate $3.41 billion. Sees net income $1.53 billion to $1.56 billion, saw $1.59 billion to $1.62 billion,
estimate $1.61 billion. Sees Net units +7% to +7.5%. - McKesson fell 7.4% afterhours after the drug distributor posted fiscal 1Q revenue that missed
estimates
Revenue at the US pharmaceuticals division and at the prescription technology solutions fell short of
expectations. FIRST QUARTER RESULTS: Adjusted EPS $7.88 vs. $7.27 y/y, estimate $7.17. Revenue $79.28
billion, +6.4% y/y, estimate $82.65 billion. US pharmaceutical revenue $71.72 billion, +6.8% y/y, estimate
$75.78 billion. International revenue $3.69 billion, +6.4% y/y, estimate $3.67 billion. Medical-surgical
solutions revenue $2.64 billion, +1% y/y, estimate $2.77 billion. Prescription technology solutions revenue
$1.24 billion, -0.2% y/y, estimate $1.46 billion. 2025 YEAR FORECAST: Sees adjusted EPS $31.75 to $32.55,
saw $31.25 to $32.05, estimate $31.59. - India’s Nifty 50 is outperforming the S&P 500 so far this year
India’s Nifty 50 is beating the S&P 500 so far this year and analysts say it could run even higher. The South
Asian index crossed the 25,000 level last week, while the BSE Sensex topped the 80,000 mark. The
macroeconomic outlook, due to expectations for the U.S. Federal Reserve to begin cutting rates, along with
increasing investment in India are expected to fuel Indian stocks. - As inflation fury lingers, politicians join customers in pushing companies to cut prices
Walmart, McDonald’s and Kroger are among the companies that have found themselves in the political
debate over higher prices or other moves that could hit Americans’ wallets. On the campaign trail, politicians
have tapped into consumers’ frustration with high prices, but Republicans and Democrats have blamed it on
different causes. Promising to tackle higher everyday costs is a safe bet during contentious times, particularly
for politicians in swing states, said Cait Lamberton, a professor of marketing at University of Pennsylvania’s
Wharton School. - Warner Bros. Discovery stock falls as it writes down $9.1 billion, misses estimates
Warner Bros. Discovery’s stock dropped Wednesday after it reported a $9.1 billion write-down on its TV
networks and missed analyst estimates on revenue. Here is how Warner Bros. Discovery performed, based
on a survey of analysts by LSEG: Loss per share: 36 cents vs. a loss of 22 cents expected. Revenue: $9.7 billion
vs. $10.07 billion expected. The company’s shares were down roughly 9% in aftermarket trading. - Google’s antitrust ruling has experts looking to 25-year-old Microsoft case for answers
A U.S. judge ruled Monday that Google holds a monopoly in the search market, and invoked the case of
Microsoft from more than two decades ago. All along, the government has implicitly and explicitly said
they’re basing this case on the Microsoft case said Sam Weinstein, law professor at Cardozo Law School and a
former DOJ antitrust lawyer. In its appeal, Google is likely to argue that the emergence of artificial
intelligence services like ChatGPT has created new competition. - Disney beats estimates as combined streaming services turn a profit
Disney reported its fiscal third-quarter earnings Wednesday, topping analyst estimates as its combined
streaming businesses turned a profit earlier than expected. Here is what Disney reported compared with
what Wall Street expected, according to LSEG: Earnings per share: $1.39 adjusted vs. $1.19 expected.
Revenue: $23.16 billion vs. $23.07 billion expected. The company’s total segment operating income increased
19% to $4.225 billion compared with the same period last year, led by the positive results for Disney’s
entertainment unit, particularly streaming. - Elon Musk ‘accountable to no one,’ UK tech minister says amid disinformation during riots
In an interview with the Times newspaper, Peter Kyle, secretary of science, innovation and technology, said
that Musk is one person who is accountable to no one. His comments add to other criticisms from U.K.
government officials of Musk, who on Sunday made comments associating riots taking place in the U.K. with
civil war. Kyle has held conversations with social media firms including TikTok, Facebook parent company
Meta, Google and X reminding them of their responsibility to tackle misinformation online. - Hamas’ new political leader Yahya Sinwar is seen as more extreme — and less willing to compromise
Hamas appointed Yahya Sinwar as the leader of its political wing following the assassination of its former
political chief, Ismail Haniyeh. This makes Sinwar — a man known for his ruthlessness who is widely seen as
having masterminded the Oct. 7 attack — the most powerful person in the organization. Haniyeh’s killing has
resulted in a much more hard-line leader for Hamas, likely dealing a severe blow to chances of a cease-fire. - As inflation fury lingers, politicians join customers in pushing companies to cut prices
Walmart, McDonald’s and Kroger are among the companies that have found themselves in the political
debate over higher prices or other moves that could hit Americans’ wallets. On the campaign trail, politicians
have tapped into consumers’ frustration with high prices, but Republicans and Democrats have blamed it on
different causes. Promising to tackle higher everyday costs is a safe bet during contentious times, particularly
for politicians in swing states, said Cait Lamberton, a professor of marketing at University of Pennsylvania’s
Wharton School. - Coupang shares rose 2.6% with analysts positive on the online retailer’s revenue growth trends. Still,
the company reported a wider-than-expected quarterly net loss due to the inclusion of operating losses
incurred at Farfetch and a fine from the Korean authorities
SECOND QUARTER RESULTS: Adjusted EPS 7.0c, estimate loss/shr 0.65c. Net revenue $7.32 billion, +25% y/y,
estimate $7.34 billion. Retail net sales $5.78 billion, +12% y/y, estimate $5.97 billion. Gross profit margin
29.3% vs. 26.1% y/y, estimate 27.3%. Adjusted Ebitda $330 million, +9.9% y/y, estimate $291 million. Active
customers 21.7 million, +10% y/y, estimate 21.93 million.
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