- Global Stock Rally Extends, Yen Rises Before BOJ: Markets Wrap
(Bloomberg) — Asian stocks extended a rally in global equities as jobs data backed the view that the US
economy is headed for a soft landing. The yen edged higher before a Bank of Japan policy decision. Equities
advanced in Japan and Australia, while Hong Kong share futures also climbed. - Dow jumps 500 points, S&P 500 closes above 5,700 for the first time a day after Fed slashes rates
Stocks jumped Thursday, with the Dow Jones Industrial Average and S&P 500 rising to new all-time highs, as
traders cheered the Federal Reserve’s Wednesday decision to lower interest rates by a half percentage point.
The 30-stock index advanced 522.09 points, or 1.26%, ending at 42,025.19, marking its first close above the
42,000 threshold. The S&P 500 rose 1.7% to close at 5,713.64, topping 5,700 for the first time. The Nasdaq
Composite surged 2.51% to end at 18,013.98. Traders got some validation that the Fed was engineering a
soft landing for the economy on Thursday as weekly jobless claims fell by 12,000 to 219,000, which was far
below estimates. - Oil prices set to end week higher after U.S. rate cut
Oil prices, which were little changed in early Asian trade on Friday, were on track to end higher for a second
straight week following a large cut in U.S. interest rates and declining global stockpiles. Brent futures, which
were trading 19 cents or 0.3% lower at $73.69 a barrel at 0027 GMT on Friday, gained 4.3% this week. U.S.
crude, which was up 6 cents at $72.01 a barrel, has registered weekly gains of 4.8%. The benchmarks have
been recovering after they fell to near three year-lows on Sept. 10, and have registered gains in five of the
seven sessions since then. The U.S. central bank cut interest rates by half a percentage point on Wednesday.
Interest rate cuts typically boost economic activity and energy demand, but some also saw the large cut as a
sign of a weak U.S. labour market. Crude inventories in the U.S., the world’s top producer, fell to a one-year
low last week, government data showed on Wednesday. - Gold set for weekly gain on Fed rate cut boost
Gold lingered near record high levels on Friday and was on track for a weekly gain after the Federal Reserve’s
recent super-sized interest rate reduction and on signs that further cuts were on the horizon. Spot gold rose
0.2% to $2,592.17 per ounce, as of 0309 GMT, up about 0.6% for the week so far. Bullion rose to a record
high of $2,599.92 on Wednesday after the Fed began easing monetary policy with a half-percentage-point
rate cut. The Fed also projected a further half-point reduction by year-end, a full point next year, and an
additional half-point in 2026. U.S. gold futures edged up 0.1% to $2,617.30. - China unexpectedly leaves benchmark lending rates unchanged after Fed’s jumbo cut
China on Friday kept its main benchmark lending rates unchanged at the monthly fixing. Market watchers
polled by Reuters had expected a trim as the Federal Reserve’s 50 basis point rate cut had given more room
for China to lower its domestic borrowing costs without prompting a sharp decline in yuan. The People’s Bank
of China (PBOC) said it would keep the one-year loan prime rate (LPR) at 3.35%, as well as the five-year LPR at
3.85%. The one-year LPR affects corporate and most household loans in China, while the five-year LPR acts as
a benchmark for mortgage rates. The rate cut stateside had allowed more monetary flexibility for China to
focus on easing the debt burden on its consumers and businesses as it seeks to bolster investment and
spending. - Japan’s Inflation Speeds Up Ahead of Expected BOJ Rate Hold
(Bloomberg) — Japan’s key inflation gauge accelerated in August for a fourth consecutive month, hours
before the Bank of Japan is scheduled to wrap up its latest policy decision meeting. Consumer prices
excluding fresh food rose 2.8% from a year earlier, speeding up from 2.7% in July as processed food costs
increased further, according to the Ministry of Internal Affairs. - Bank of Japan keeps benchmark interest rate steady as it treads cautiously on normalizing policy
The Bank of Japan kept its benchmark interest rate steady at around 0.25%, the highest rate since 2008, at
the conclusion of a two-day meeting Friday. The decision came as the BOJ treads cautiously with the task of
normalizing monetary policy after a long-held ultra-easy approach, and doing so without prompting a shock
to its economy. - Summers Sees Fed Rate Projections Upended, Higher Mortgage Rates
(Bloomberg) — Former Treasury Secretary Lawrence Summers said inflation will probably prevent the Federal
Reserve from lowering interest rates as much as expected in coming years. The risks of actually going as far
with monetary policy as the Fed seems to think that it will are pretty significant in terms of having an increase
in inflation, Summers said on Bloomberg. - Trump Vows to Bring Back Travel Ban, Bar Refugees From Gaza
(Bloomberg) — Former President Donald Trump vowed to reinstate his travel ban that barred people from
some predominantly Muslim countries and expand it to prevent refugees from war-torn Gaza from entering
the US. I will ban refugee resettlement from terror infested areas like the Gaza Strip, and we will seal our
border and bring back the travel ban, Trump said Thursday. - Anthony Scaramucci says he is working alongside Kamala Harris on her campaign’s crypto policies
Anthony Scaramucci, founder and managing partner of SkyBridge Capital, says he and a group of crypto
advocates are working with U.S. Vice President Kamala Harris to develop her campaign’s policies on digital
assets. I believe that we are making progress, and I think it’s going in the right direction, Scaramucci said at
the annual TOKEN2049 event in Singapore, of the world’s largest crypto conferences. Kamala Harris’
presidential campaign did not immediately respond to CNBC’s request for comment. - Germany Investigates Its Own Handling of Commerzbank Stake Sale
(Bloomberg) — The German government has started an internal probe into its Commerzbank AG share sale
after the transaction allowed UniCredit SpA to swoop in and take a major stake in the lender. The Chancellery
isn’t happy with the outcome of the placement last week, which was overseen by Germany’s Finance Agency,
and it’s now trying to figure out what went wrong. - Oracle-Backed Chip Designer Ampere Is Said to Explore Sale
(Bloomberg) — Ampere Computing LLC, the semiconductor startup backed by Larry Ellison’s Oracle Corp., is
exploring a potential sale, according to people with knowledge of the matter. The chip designer has been
working with a financial adviser in recent months to help field takeover interest, said the people, who asked
not to be identified discussing private information. - Apple iPhone Hits Stores Without Its Highly Awaited AI Features
(Bloomberg) — Apple Inc. is facing an unprecedented challenge: persuading customers to buy its latest
iPhones without their biggest new feature. On Friday, Apple is launching the iPhone 16 lineup in almost 60
countries, including the US, China, India, Australia and South Korea. But the device won’t come installed with
Apple Intelligence. - Alibaba ADRs rose 4.8% Thursday after announcing the launch of more than 100 new open-source AI
models and introduced a text-to-video generation tool
The new models, named Qwen 2.5, are designed for various applications, including automotive, gaming, and
scientific research. They feature enhanced capabilities in mathematics and coding, Alibaba stated.
These models are open-source, allowing global researchers, academics, and companies to utilize them
without needing to train their own systems, saving time and costs. Alibaba aims to increase the adoption of
its AI by making these models accessible. The company also upgraded its proprietary flagship model,
QwenMax, which is sold through its cloud computing services. Alibaba claims Qwen-Max outperforms competitors
like Meta Platforms Inc. and OpenAI in reasoning and language comprehension. - CrowdStrike shares rose 3.8% as analysts say customer attendance and feedback for the security
software company’s Fal.Con conference was positive despite its recent outage. However, analysts did note
near-term headwinds still pressuring the stock
Morgan Stanley analyst Hamza Fodderwala (overweight, PT $325): CrowdStrike’s annual Fal.Con conference
was very well attended with attendance up by more than 30%. However, the company’s investor day was
slightly more cautious, given near-term headwinds to annual recurring revenue and free cash flow. The stock
is likely rangebound nearer term, but longer term story of CRWD as a leading security platform consolidator
remains intact. BofA analyst Tal Liani (buy, PT $365): After hearing about CrowdStrike’s products, financing
and customer feedback, we are bullish after the investor conference. - Darden Restaurants Inc. shares rose 8.3% after the owner of Olive Garden announced a new delivery
partnership with Uber Technologies Inc. and said sales started recovering in August
The restaurant operator plans to offer nationwide delivery for Olive Garden through a two-year partnership
with Uber by May next year, according to a statement Thursday. A pilot at a limited number of stores is
planned for late this year. The deal signals Darden, which had previously resisted allowing its food to be
widely delivered by third-party apps, is trying to attract cash-strapped consumers after seeing a significant
drop in customers in July. Business picked up at Olive Garden after it extended its Never Ending Pasta Bowl
promotion by four weeks, Darden Chief Executive Officer Rick Cardenas said on the company’s earnings call.
Cardenas said all of Darden’s brands began recovering in August. The recovery led Darden to maintain its fullyear guidance. Revenue for the first quarter was $2.76 billion, lower than analysts expected. The difficult July saw Darden’s comparable sales fall 1.1% in the first quarter compared to the same period last year, with Olive Garden down 2.9%. - Nike Inc. shares rose 7.6% afterhours after it ousted beleaguered chief executive John Donahoe and
brought longtime executive Elliott Hill out of retirement
Hill, 60, originally joined Nike in 1988 and served as president of consumer and marketplace before he retired
in 2020. He will take over on Oct. 14. Donahoe, 64, will retire on Oct. 13 and will remain an adviser at Nike
through Jan. 31. The sportswear company’s sales have dropped as consumers have grown tired of its lifestyle
sneakers. Nike lost ground to upstart athletic brands such as On and Hoka, as well as more established rivals
like Adidas. Layoffs that impacted 2% of its workforce and a $2 billion cost-cutting plan dented morale and
left employees questioning if Donahoe was the right person to meet the moment. He has been on the hot
seat since Nike slashed its revenue forecast in December and warned in June that sales for the new fiscal year
would be below expectations. Investors will be looking for the new regime to speed up product development
and release more of the groundbreaking sneaker technology that once defined the brand. Over the past year,
Nike has found itself lacking enough new exciting products to cycle in and keep shoppers interested. - FedEx Corp. shares sank 11.1% afterhours after it said its business would slow in the year ahead and
reported a worse-than-expected quarterly profit in a warning sign about the direction of the US economy
The parcel giant was hurt by a pullback on priority services as customers traded down to cheaper shipping
options in what Chief Executive Officer Raj Subramaniam called a challenging quarter. A broad effort to slash
costs gained traction but only partially blunted those headwinds, the company said. FedEx saw increasingly
price-sensitive customers downgrading to slower and cheaper shipping options during its latest quarter, a
trend that also hit UPS earlier this year. US domestic shipping volumes fell 3% at FedEx’s Express segment
due to weaker business-to-business demand, Chief Customer Officer Brie Carere said. Expectations for higher
revenue and profits from premium services in the US also failed to materialize, Chief Financial Officer John
Dietrich said. The sense of urgency isn’t there to pay extra for ultra-fast shipping, said Bloomberg Intelligence
analyst Lee Klaskow. That usually happens when things are kind of tough, when people are trying to save
money. FedEx now expects adjusted full-year earnings of $20 to $21 a share in the current fiscal year, below
its previous forecast for as much as $22 a share. The midpoint of the new range is roughly in line with the
$20.53 average analyst estimate. - Mobileye Global Inc. shares gained 15% after the company’s majority shareholder, Intel, confirmed that
it has no current plans to sell its interest in the self-driving technology company
Intel was said to be considering various options for its business recently, including a possible sale of its
Mobileye stake. But the company earlier this week announced a variety of other plans, including turning the
foundry business into a subsidiary, and then Thursday it sought to reassure investors on Mobileye
specifically. As the majority shareholder in Mobileye, Intel has an unwavering focus on value creation and are
excited about the future of its business, the company said in a statement posted to its website. We currently
do not have any plans to divest a majority interest in the company.
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