- Asian Equities Rally as US Recession Fears Fade: Markets Wrap
(Bloomberg) — Stocks in Asia rose Friday after robust US jobs and spending data eased recession concerns,
fueling a rally in stocks and sending bonds tumbling. Equity benchmarks in Japan climbed as much as 2.4%,
while shares in Australia increased alongside those in South Korea. - Stocks close higher, S&P 500, Nasdaq notch six-day winning streak as comeback rally gains steam
Stocks rallied on Thursday as investors regained confidence in the economy following encouraging consumer
and labor data that helped ease recession worries. The Dow Jones Industrial Average leaped 554 points, or
1.39%, to end the day at 40,563.06. The S&P 500 closed up 1.61% at 5,543.22, for its sixth straight gain. The
broad market index has advanced roughly 8% from its intraday bottom on Aug. 5. The Nasdaq
Composite jumped 2.34% to 17,594.50. Retail sales increased 1% in July, far surpassing an estimate from Dow
Jones that forecast a 0.3% uptick. Also separately, weekly jobless claims fell for the week. The data served as
a boon to investors and a broader market trying to mount a comeback from an August rout tied to concerns
about a slowing economy that arose following July’s disappointing jobs report on Aug. 2. After a more than
3% gain this week, the S&P 500 is now roughly 2% below its record. - Oil prices set for weekly gains on renewed enthusiasm around U.S. economy
Oil prices edged lower in early Asian trading on Friday, but the market’s benchmarks were set for a second
consecutive weekly gain after upbeat U.S. economic data eased investor worries about a potential recession
in the top oil consuming nation. Brent crude futures fell 16 cents, or 0.2%, to $80.88 per barrel by 0024 GMT.
U.S. West Texas Intermediate crude futures fell 23 cents, or 0.3%, to $77.93 a barrel. Brent was set to
advance 1.6% on a weekly basis, while WTI was on track for gains of about 1.5%. Investors found renewed
optimism around U.S. economic growth after a string of data releases this week. - Gold pares gains as dollar, bond yields climb after strong U.S. data
Gold prices pared gains on Thursday as the dollar and Treasury yields rose after stronger-than-expected U.S.
economic data that could influence the size of interest rate cuts from the Federal Reserve.
Spot gold inched higher 0.3% at $2,455.79, after rising as much as 0.9% earlier in the session. U.S. gold
futures rose 0.6% to $2,493.6. Retail sales being so positive that shows the economy is strong and that has
kind of turned the markets, and the dollar is regaining some of its strength and gold’s losing some of its
lustre, said Chris Gaffney, president of world markets at EverBank. U.S. retail sales increased 1.0% last month
after a downwardly revised 0.2% drop in June, the Commerce Department’s Census Bureau said. - Quant Funds Are Poised to Unleash Cash in Stock Market
(Bloomberg) — The largest unwind in US equities since the Covid-19 pandemic is over, and now trend-following quant funds are ready to return to the stock market. Over the past month, so-called systematic
funds, which buy stocks based on market signals and volatility moves rather than company fundamentals,
have sold the largest dollar-volume of equities in four years. - Hedge Fund Viking Scores With Bet on GE Clean-Energy Spinoff
(Bloomberg) — When General Electric Co. spun off its GE Vernova unit, Viking Global Investors rotated all of
its GE exposure into shares of the newly public clean-energy business. That bet has paid off so far for Andreas
Halvorsen’s hedge fund firm, with the stock soaring 40% since it started trading on March 27. It’s Viking’s
biggest winner in the second quarter. - NYC Mayor Eric Adams Subpoenaed as Part of DOJ Investigation
(Bloomberg) — New York Mayor Eric Adams was subpoenaed as part of a corruption probe by the Justice
Department, the New York Times reported. Attorneys for Adams, who said they’re in the process of
responding to the subpoenas, said they continue to cooperate with the investigation and expect a prompt
and just resolution. - Trump Made $300,000 for Endorsing Bible, Financial Disclosure Shows
Donald J. Trump also listed $100 million in liabilities over judgments he owes in civil cases, and over $1
million in crypto holdings as he courts the industry for his campaign. Donald J. Trump’s latest financial
disclosure lists more than $100 million in liabilities stemming from three civil lawsuits he lost in New York
that required him to obtain bonds. - Gaza Truce Talks Open in Doha as Israel-Iran Tensions Simmer
(Bloomberg) — Israel began talks with international mediators about a proposed pause to the more than 10-
month-old war in Gaza in an effort to douse spiraling tensions between the Jewish state and Iran. An Israeli
delegation led by David Barnea, director of the Mossad spy service, arrived in Qatar to meet with its Prime
Minister Sheikh Mohammed bin Abdulrahman Al Thani. - Trump Defends Attacks on Harris as Allies Urge Focus on Economy
(Bloomberg) — Donald Trump said he believes his strategy of personal insults against Vice President Kamala
Harris is boosting his campaign, despite pleas from his own party to focus on policy as polls show he is losing
ground in the race for the White House. I think I’m entitled to personal attacks, Trump said at a press
conference at his golf club in Bedminster. - RBA’s Bullock Says It’s Premature to Think About Rate Cuts
(Bloomberg) — Australia’s central bank remains some way off easing monetary policy, Governor Michele
Bullock said, as inflation is proving persistent and will only return back to the target range late next year. The
board remains vigilant to upside risks to inflation, Bullock said in her opening statement to a parliamentary
panel in Canberra on Friday. - China Central Bank Sees More Growth Steps But Nothing Drastic
(Bloomberg) — China’s central bank chief pledged further steps to support his nation’s economic recovery,
while cautioning that it won’t be adopting drastic measures. Chinese state media published a pair of
interviews with People’s Bank of China Governor Pan Gongsheng on Thursday after key indicators for July
suggested the country’s economic growth remains lackluster. - Steadfast US Consumer, Job Market Allay Concerns About Economy
(Bloomberg) — Fresh readings on retail spending and unemployment benefits quelled some of the restiveness
about the US economy, parts of which remain restrained by elevated interest rates. The value of retail sales
increased in July by the most since early 2023 in a broad advance that indicates a resilient American
consumer. - White House Walks Back Biden Comment on Venezuelan Election
(Bloomberg) — The White House on Thursday walked back President Joe Biden’s apparent suggestion that
Venezuela hold a new election after the comment prompted questions about the US position on a July vote
that it has consistently said Nicolas Maduro’s regime rigged. - Divergence on BOJ Policy Emerges Among PM Candidates in Japan
(Bloomberg) — As Japan’s race for a new premier heats up, candidates will be scrutinized for their views on
monetary policy, with the shake-up coming at a pivotal moment when the economy is just emerging from
decades of deflation. A recent episode illustrates the risks for politicians when they weigh in on central bank
policy. - Traders Shred Bets on Big Fed Rate Cuts on Resilient Economy
(Bloomberg) — Treasury yields surged after signs of a resilient US economy in the latest data releases
prompted traders to lower their expectations of aggressive Federal Reserve interest-rate cuts this year. The
move in Treasuries was led by the policy-sensitive two-year yield, which rose 16 basis points to nearly 4.12%
on Thursday after readings of US retail sales. - Stocks Rally as Data Show US Economy Is Holding Up: Markets Wrap
(Bloomberg) — Stocks climbed and bonds tumbled as data on retail spending and the labor market
underscored the strength of the world’s largest economy, allaying fears the Federal Reserve would be risking
a deeper slowdown. As economic jitters abated, the S&P 500 extended a six-day rally to 6.6%, the best
performance in such a span since November 2022. - Bank of America Strikes Sponsorship Deal for 2026 FIFA World Cup
(Bloomberg) — Bank of America Corp. is adding to its list of sports sponsorships with a deal for the FIFA World
Cup, looking to capitalize on the billions of international viewers the football tournament attracts. The
second-largest US bank will be the first banking partner for the event in 2026, according to company
executives. - XPO Revives Sale of European Transportation Business
(Bloomberg) — XPO Inc. has revived a sale of its European transportation business, according to people
familiar with the matter, almost two years since it last scrapped the attempt to divest the operation. The
New York-listed logistics firm has been working with advisers and sounding out potential buyers for the
business, which includes truckload. - London’s IPO Prospects Tested by Executive Pay Gap: ECM Watch
(Bloomberg) — London’s prospects of winning more initial public offerings are being tested by a widening
executive pay gap with the US. Research by the High Pay Centre think-tank showed this week that median
pay for FTSE 100 CEOs rose 2% last year to a record £4.19 million, $5.4 million. That lags the 12.5% annual
increase for CEOs of S&P 500 companies. - Intel Missed Out on AI Chip Deal, Report Says. What It Means for the Stock
Intel CEO Pat Gelsinger is pinning his hopes of a turnaround on making the company a leader in chip
manufacturing. The latest signs are that it is still struggling to make progress against rivals such as Taiwan
Semiconductor Manufacturing. Japan’s SoftBank Group was planning with Intel to manufacture chips rivaling
those made by Nvidia. - Market Chatter: TD, RBC Settle U.S. Charges Over Employee Use of Personal Devices and Chat App
Toronto-Dominion Bank, TD.TO, TD, and Royal Bank of Canada, RY.TO, RY, are paying multimillion-dollar
penalties to settle charges with the U.S. Securities and Exchange Commission over their employees’
unapproved communication methods, The Globe and Mail newspaper is reporting. It noted TD Bank will pay
a US$46.5-million penalty. - Walmart Inc. raised its sales guidance for the full year, buoyed by consumers buying necessities and
seeking deals even as they curtail spending elsewhere
The company said it now expects net sales to rise as much as 4.75% for the year, versus previous guidance for
a gain of as much as 4%. It also raised its targets for operating income and profits. We are seeing that the
consumer continues to be discerning, choiceful, value-seeking and focusing on essentials, Chief Financial
Officer John David Rainey said. We are not seeing any incremental fraying of our customers’ financial health.
Walmart shares rose 6.6%. Walmart said comparable sales in the US rose 4.2%, excluding fuel, last quarter
driven by higher units and transactions. Analysts expected a gain of 3.4% for the metric, which captures
revenue generated online and in stores open at least a year. It posted adjusted earnings of 67 cents a share,
topping the analysts’ average estimate of 65 cents. The company’s sales of general merchandise grew after
11 consecutive quarters of declines. - Deere shares rose 6.3% after the world’s top tractor maker reported better-than-expected results and
affirmed its profit outlook as cost-cutting efforts help it weather a slumping farm economy
The company said net income for the current fiscal year would be about $7 billion, on par with its outlook in
May and above the consensus for $6.94 billion. That’s as the company reported $1.73 billion in third-quarter
profit that was almost 9% higher than the median forecast. Deere has laid off workers and idled
manufacturing capacity as demand for its green and yellow farm machines has been falling from record levels
two years ago. Analysts expected the company to cut its outlook for the third straight quarter after rival CNH
Industrial NV lowered its expectations and AGCO Corp. trimmed $1 billion from its outlook in July. Instead,
Deere kept its guidance unchanged, even with the company’s global net sales slumping 17% in its fiscal third
quarter. - Applied Materials Inc., the largest US maker of chip-manufacturing equipment, delivered an in-line
sales forecast that disappointed investors who’d been looking for a bigger payoff from artificial intelligence
spending
Fiscal fourth-quarter sales will be about $6.93 billion, the company said. That matched the average analyst
estimate. Profit, minus certain items, will be roughly $2.18 a share. Analysts were projecting $2.15 for the
period, which runs through October. The shares fell 3.1% in afterhours trading, following a 5.1% increase in
regular trading, a sign some investors were hoping for more of a blowout quarter. Demand for gear used in
the production of high-end processors, needed to develop and run AI software, remains strong, Chief
Executive Officer Gary Dickerson said. Customers are scrambling to make gains in the market, causing them
to spend heavily on new technology, he said. - Grab Slides After Sales Miss Estimates on Tough Competition
Grab Holdings Ltd. shares slumped after the ride-hailing company reported quarterly revenue growth that
trailed estimates, highlighting intense competition in the Southeast Asian market. The stock slid 5.5% at 9:58
a.m. in New York on Thursday after the company said revenue rose 17% to $664 million in the three months
through June, missing the $676.9 million analysts predicted on average. Adjusted earnings before interest,
taxes, depreciation and amortization were $64 million, roughly in line with expectations. Grab, the largest of
Southeast Asia’s ride-hailing and delivery firms, is trying to prove its brutal cost-cutting drive is yielding
results. The Singapore-based company is focused on profits after years of spending to grow its market share
and fend off competition. Yet Indonesia’s GoTo Group is proving a tough rival, keeping prices low and
margins thin for both companies as they battle it out in the Southeast Asian market of 675 million people. - Cisco Systems Inc shares rose 6.8% after the biggest maker of computer networking equipment
reported fourth-quarter results that beat expectations and gave a bullish revenue forecast for the current
period
The company also announced plans to cut thousands of jobs as part of a strategy shift towards cybersecurity,
cloud systems and artificial intelligence-related products according to Chief Financial Officer Scott Herren. - United CEO expresses renewed confidence in Boeing after meeting with new leader Ortberg
United Airlines CEO Scott Kirby says he is optimistic about Boeing’s recovery after meeting with the
manufacturer’s new chief executive. It’s an upbeat change of tune from the head of United, a top Boeing
customer that has been among the most publicly frustrated about the plane maker’s problems, which have
led to delayed deliveries of dozens of aircraft. Kirby and Boeing’s new CEO, Robert Kelly Ortberg, had lunch
earlier this week in the Dallas area. Kirby said in a LinkedIn post on Thursday that he was not only encouraged
by what I heard, but I also came away with a renewed confidence that Boeing is on the right path and will
recover faster than most expect. United has 484 unfilled orders with Boeing, according to the manufacturer’s
website. - Walmart says prices are coming down, except in one key area
Walmart said inflation was flat in its latest quarter, and revenue growth came from selling more items and
drawing more visits to its stores and website, rather than higher prices. Yet prices have remained high in
some parts of the store, such as dry groceries and processed foods. Prices at consumer brands, including
Walmart, have faced more scrutiny from both consumers and politicians. - Replacing China in copper supply chain is unfeasible, warns WoodMac, as the West seeks shift
Western countries seeking to diversify away from China’s dominance in copper could delay the energy
transition besides raising costs, while its complete replacement would be ‘unfeasible,’ according to Wood
Mackenzie. China leads the world in key segments of the copper supply chain, with the critical metal serving
as an important component in emerging technologies such as renewable energy, energy storage and electric
vehicles. As the U.S., Canada, Australia, and European countries seek to displace the country’s hold on copper
through subsidies and investment, Wood Mackenzie warns that the dual aims of decarbonization and
reduced dependence on Beijing are at odds with one another. - What’s next for the Biden administration’s Medicare drug price negotiations
The Biden administration released prices or the first 10 medications subject to historic negotiations between
the federal Medicare program and drugmakers. But the announcement is just the beginning of a
controversial, multi-round process that could produce more savings for taxpayers and older Americans and
put more pressure on pharmaceutical companies over time. It’s a key provision of President Joe Biden’s
signature Inflation Reduction Act, which was signed into law two years ago. - Meta CEO Mark Zuckerberg receives letter from lawmakers concerned about illicit drug ads on
Facebook and Instagram
A bipartisan group of lawmakers sent Meta CEO Mark Zuckerberg a letter expressing concern about illicit
drug advertisements running on Facebook and Instagram. The letter cites recent reports from The Wall Street
Journal and the Tech Transparency Project nonprofit that uncovered a flood of such ads on Meta’s apps.
Meta acknowledged receipt of the letter and said it plans to respond. - Goldman Sachs jumps into bitcoin ETFs and one hedge fund gets bullish on miners
Goldman Sachs made its debut in the spot bitcoin ETF market in the second quarter, purchasing $418 million
worth of bitcoin funds. Wednesday’s 13F quarterly filing deadline offers the latest read on the equity
positions taken by large investors. Ether ETFs just hit the market last month, so those inflows won’t show up
until filings hit for the third quarter.
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