- Asia Stages Cautious Open After Bleak Chinese Data: Markets Wrap
(Bloomberg) — A gauge of Asian stocks struggled to find direction on Monday as traders weighed the extent
of slack in China’s economy after worse-than-expected activity data landed over the weekend. Australia’s
benchmark inched up in early trade and US futures showed incremental gains, after the S&P 500 registered
its best week of the year on Friday. - S&P 500 and Nasdaq rally Friday to cap best week in 2024
Stocks rose on Friday, with the S&P 500 and the Nasdaq Composite posting their strongest week of 2024
ahead of the upcoming Federal Reserve meeting. The S&P 500 climbed 0.54% and closed at 5,626.02, less
than 1% from its July all-time high. The tech-heavy Nasdaq Composite added 0.65% to end at 17,683.98. Both
indexes posted their fifth consecutive winning day. The Dow Jones Industrial Average jumped 297.01 points,
or 0.72%, closing at 41,393.78. Utilities, communications services and industrials led the market higher on
Friday, with each sector adding roughly 1%. Investors also continued to rake up shares of megacap tech and
semiconductor names, which helped drive this week’s rebound rally after tech’s recent underperformance.
Powerhouse chipmakers Super Micro Computer and Arm Holdings added 3.4% and 5.9%,
respectively. Alphabet advanced 1.8% and Uber jumped more than 6%. - Oil prices inch up on Fed rate cut outlook
Oil prices edged up in early trade on Monday amid expectations of a U.S. interest rate cut this week, though
gains were capped by U.S. supply resumptions following Hurricane Francine and weaker China data. Brent
crude futures for November were up 15 cents, or 0.2% at $71.76 a barrel at 0015 GMT. U.S. crude futures for
October were up 23 cents, or 0.3%, at $68.88 a barrel. Both contracts had settled lower in the previous
session, with concerns about supply disruptions easing as Gulf of Mexico crude production resumed following
Hurricane Francine and as rising data showed a weekly rise in U.S. rig count. Still, nearly a fifth of crude oil
production and 28% of natural gas output in the Gulf of Mexico remain offline in the hurricane’s aftermath. - Gold skyrockets as stars align for Fed rate cuts
Gold prices powered higher on Friday, beating record levels, as a boost in bullish momentum fuelled by
optimism that the U.S. Federal Reserve is on the brink of trimming interest rates was catalysed by fund
inflows and a drop in the dollar. Spot gold was trading at record levels, up 0.9% at $2,582.05 per ounce by
11:58 a.m ET (1558 GMT). U.S. gold futures rallied 1.2% to $2,610.30. Gold market bulls are locking in bullion
prices surging to fresh records, with a milestone of $3,000 per ounce coming into focus, fired up by monetary
easing by major central banks and a tight U.S. presidential election race. - Zero Hedge: Hedge Funds Pile On Shorts, Sell Stocks For 5th Consecutive Week Despite Furious Rally
Stocks closed just shy of all time highs, the S&P500 surging 4% last week – its best week of the year – after
tumbling in the first week of September – its biggest drop since March 2023 – but one wouldn’t know there
was such a powerful reversal in sentiment by looking at the ongoing liquidation among the smart money
crowd. - Deciphering the Fed’s Next Move With Soft Landing at Stake
(Bloomberg) — The Federal Reserve will begin a crucial pivot this week, lowering interest rates for the first
time in more than four years as it pursues a rare soft landing for the US economy. With inflation seemingly
under control and weakness showing in the US labor market, officials are widely expected to drop their
benchmark lending rate by at least a quarter percentage point when they wrap up a two-day gathering on
Wednesday. In financial markets, some traders, and economists at JPMorgan Chase & Co., the largest US
bank, are even preparing for a larger, half-point move. - India can achieve sustainable growth of up to 8% in the coming years, central bank chief says
Reserve Bank of India Governor Shaktikanta Das said the country’s expected growth rate over the next few
years stood at 7.5%, with upside possibilities. Das said it was difficult to say what healthy growth looks like
for the world’s most populous country, but growth of 7.5% to 8% can be sustainable. It comes as major
central banks have started to ease monetary policy in recent months, including the European Central Bank,
the Bank of England and the Swiss National Bank. - Gary Cohn Says Fed Rate Cuts Already Priced Into Mortgage Market
(Bloomberg) — The Federal Reserve’s expected rate cuts this week won’t provide much relief to homebuyers
facing high borrowing costs, according to Gary Cohn, who served as chief economic adviser to former
President Donald Trump. Unfortunately, I think those rates have already priced in what the Fed is going to
do, Cohn said Sunday on CBS’s Face the Nation. - ASIA WEEK AHEAD: China Rates, Japan CPI, BOJ Likely to Hold
(Bloomberg Economics) — We expect the People’s Bank of China to hold its one-year medium-term lending
facility rate steady when it conducts the operation between Sept. 18-25, and see banks keeping their loan
prime rates unchanged in the week ahead. But with activity data sounding a loud alarm about deepening
weakness in the economy, more stimulus from the PBOC before year-end looks likely. - China Activity Sliding Into Ditch Sounds Policy Alert: Economics
(Bloomberg Economics) — OUR TAKE: China’s August activity data sound a loud alarm about deepening
weakness in the economy. Production and consumption, proxied by retail sales, slowed more than expected.
Fixed asset investment, a key lever for policy support, also lost speed. Against a backdrop of slack credit, the
data raise concerns about weakness extending into year-end unless stimulus is turned up sharply. - Hong Kong stocks fall as investors digest China economic data, await Fed rate verdict
Markets in mainland China and South Korea are closed Monday for Mid-Autumn festival. Japan markets are
closed for the Respect for the Aged Day. Reaction to China’s disappointing economic data is seen in the Hong
Kong market. Typhoon Bebinca has led to cancellation of hundreds of flights in China and Shanghai is
expected to be hit by the strongest storm since 1949. - Trump Safe After Apparent Assassination Attempt in Florida
(Bloomberg) — Former President Donald Trump is safe after his Secret Service detail opened fire at a man
who was wielding an assault rifle at his West Palm Beach, Florida, golf course Sunday, in what the Federal
Bureau of Investigation called an apparent assassination attempt. A suspect in custody was identified by
federal officials as Ryan Routh, 58. - Softbank-Backed Swiggy Said to Eye India IPO Filing This Week
(Bloomberg) — Indian food-delivery platform Swiggy Ltd. is considering filing publicly for its domestic initial
public offering as soon as this week, people familiar with the matter said, adding to a strong pipeline of share
sales in the country. Swiggy’s IPO may seek to raise more than $1 billion, the people said, asking not to be
identified. - Temasek Said to Near Stake Purchase in Blackstone-Owned VFS
(Bloomberg) — Temasek Holdings Pte is nearing a deal to buy a significant minority stake in VFS Global,
according to people familiar with the matter, a transaction that could value the visa outsourcing and
technology services firm at about $7 billion including debt. The Singapore state-owned investor is poised to
acquire about 20% in closely held VFS. - Boeing silent amid Starliner rift speculation, but NASA hopeful of its commitment: What we know so
far
(MINT) – Boeing has been silent ever since the National Aeronautics and Space Administration (NASA)
decided to bring Starliner back to Earth without its crew members. The absence of Boeing officials during the
news conference held after Starliner’s landing on Earth on September 7 fueled speculation about a rift
between NASA and Boeing. - Adobe shares are down 9.4% on Friday after the creative-arts software company gave a fourth-quarter
forecast that was weaker than expected as the monetization ramp for its new artificial intelligence tools
takes more time. The company also reported third-quarter results that beat expectations
FOURTH QUARTER FORECAST: Sees revenue $5.50 billion to $5.55 billion, estimate $5.6 billion (Bloomberg
Consensus); Sees adjusted EPS $4.63 to $4.68, estimate $4.68; Sees Digital Media net new annualized
recurring revenue about $550 million, estimate $561.1 million; Sees digital media revenue $4.09 billion to
$4.12 billion, estimate $4.14 billion; Sees digital experience revenue $1.36 billion to $1.38 billion, estimate
$1.4 billion; Sees Digital Experience subscription revenue $1.23 billion to $1.25 billion, estimate $1.24 billion. - Boeing shares fall as much as 2% on Friday after the planemaker’s factory workers walked off the job
for the first time in 16 years
Move to cripple output at Seattle commercial jet hub. As of the last close, the stock has fallen 38% this year.
Jefferies analyst Sheila Kahyaoglu (buy, PT $270): “The magnitude of the strike’s impact will be dependent on
its duration”; The company was hit by a 58-day strike in 2008, delaying >100 aircraft deliveries; Boeing stated
that it was ready to get back to the table and reach a new agreement, Kahyaoglu writes. Bloomberg
Intelligence analyst Tim Bacchus: Boeing’s latest strike, even an extended one, might have relatively little
impact on Asian and Mideast airlines; In Europe, Ryanair is most exposed as it expects eleven 737 MAX 8
deliveries, nine which are unfinished. - AstraZeneca shares drop as much as 1.4%, falling for a fourth straight session, after Deutsche Bank
downgrades to sell from hold and sets a Street-low price target. The broker cites a challenging risk-reward
over the next 6-12 months
It was difficult to accept the experimental Dato-DXd medicine was not going to be the next breakthrough in
lung cancer we had hoped last summer, analyst Emmanuel Papadakis writes in a note. Although AstraZeneca
has other pipeline prospects, the company’s revenue outlook now seems in question. PT lowered to a Street-
low 10,500p from 11,000p; shares closed at 12,050p on Thursday. - Oracle shares rise as much as 7.8% to $173.94 on Friday, hitting its highest level on record, after the
software company gave a long-term forecast that is seen as underlining the its growth drivers
Analysts were expecting a strong 2026 forecast, but they were more impressed by the bullish 2029 revenue
targets. BMO Capital Markets analyst Keith Bachman (market perform, PT $173): While a raise to previous
FY26 target was expected, we think establishing new and ambitious FY29 targets will inspire more confidence
in the FY26 targets and sustainable growth; Thinks the valuation for Oracle is more driven by price-to-
earnings than free cash flow, given heavy capex cycles. KeyBanc Capital Markets analyst Jackson Ader
(overweight, PT to $190 from $175): Oracle’s 2029 revenue targets matched the bullishness the company has
been coyly hinting at for a number of months now; It is clear that Oracle thinks that AI will be a tailwind to its
cloud infrastructure business. - Uber shares rise as much as 6.9% on Friday after the ride-hailing company said it will be the sole app
offering driverless rides in Alphabet Inc.’s Waymo cars in Austin and Atlanta
Bloomberg Intelligence analyst Mandeep Singh says Uber’s exclusive pact helps lower the marketplace risk
for Uber amid the anticipated launch of Tesla robotaxis in October; Still, take rates of about 30% in Uber’s
Mobility segment will likely come down, while fixed costs could increase as it provides maintenance for
Waymo vehicles. Evercore ISI analyst Mark Mahaney says this pact is a key catalyst for UBER and directly
addresses the single biggest overhang on UBER shares; The win for UBER is that robo-taxi offerings will over
time improve the supply options for UBER customers while potentially improving the unit economics for
UBER. - Warner Bros Discovery shares are up 8.9% on Friday, extending a recent climb after its multi-year
distribution partnership with Charter Communications was renewed early
WBD is the day’s biggest gainer among S&P 500 components, building on yesterday’s gain of 10%; Charter is
up 1.6% on Friday. Wolfe Research: We view the deal as a win/win providing Charter video subscribers with
more content/value and Warner with a way to generate more revenue over a fixed cost base; Warner will
earn a wholesale fee for Max contributing to higher overall revenue per subscriber, which is better than we
anticipated amidst the expected loss of the NBA; Wolfe has a peer perform rating on Charter and an
underperform rating on Warner.
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