- Asia Tracks Worst US Selloff Since August Crash: Markets Wrap
(Bloomberg) — Stocks in Asia sank after Wall Street posted its worst day since the Aug. 5 rout, as weak US
data and falling oil prices raised concerns about the health of the global economy. Japan led the slump, with
the Nikkei 225 down over 3%. Shares also fell in Australia and South Korea, while futures pointed to losses in
Hong Kong. - Dow closes 600 points lower to begin September, S&P 500 drops 2%
Stocks tumbled Tuesday as technology names struggled and new economic data rekindled fears around the
health of the economy. The Dow Jones Industrial Average fell 626.15 points, or 1.51%, to end at 40,936.93.
The S&P 500 slid 2.12%, closing at 5,528.93. The Nasdaq Composite dropped 3.26% and settled at 17,136.30.
All three indexes notched their worst days since the global sell-off on Aug. 5. Chip stocks weighed on the
market, with high-flying Nvidia dropping more than 9%. Micron, KLA and Advanced Micro Devices also saw
declines in the session. - Oil prices extend slump on likely restoration of Libyan production, OPEC+ plans to raise output
Oil prices extended declines during Asia trading hours, after a report that Libya’s oil production was set to be
restored pressured prices overnight. OPEC+ plans to raise output amid weakness in China’s economy have
also been dragging prices lower. Global benchmark Brent slipped 0.57% to $73.33 a barrel, while U.S. West
Texas Intermediate futures fell 0.65% to trade at $69.88 per barrel. - Gold steady as U.S. payrolls data grabs limelight
Gold prices held steady on Wednesday as investors braced for a monthly U.S. payrolls report that could
influence how swiftly and deeply the Federal Reserve cuts interest rates this year. Spot gold held its ground
at $2,493.34 per ounce by 0200 GMT after hitting its lowest level in more than a week on Tuesday. U.S. gold
futures were nearly unchanged at $2,524.80. - Hedge Funds Kite Lake and Astaris Prepare to Close to New Cash
(Bloomberg) — Two hedge funds in London are preparing to close to new cash even as the broader industry
bleeds tens of billions of dollars in capital. Kite Lake Capital Management will stop taking money in its flagship
$1.4 billion KL Special Opportunities Fund on Oct 1, according to an investor letter and a person familiar with
the matter. - Singapore Air Checks A350 Fleet as Air China Scrubs Some Flights
(Bloomberg) — Some of Asia’s largest operators of the Airbus SE A350, including Singapore Airlines Ltd., said
they would undertake checks of their fleet after Cathay Pacific Airways Ltd.’s mid-flight discovery of an
engine component issue in the aircraft type. Singapore Air said it would inspect all the engines powering its
fleet of 64 A350-900 aircraft. - US Unseals Charges Against Hamas Days After Death of American
(Bloomberg) — The US Justice Department announced Tuesday that it had charged six senior leaders of
Hamas with terrorism and conspiracy to kill Americans, days after six hostages including an Israeli-US citizen
were slain in the Gaza Strip. The charges against Hamas leaders Yahya Sinwar and other top Hamas
operatives were filed in February. - US Jobs Data Return to Center Stage as Fed Mulls Rate-Cut Size
(Bloomberg) — With the Federal Reserve set to begin cutting interest rates in a few weeks, the main question
now is how big the first reduction will be. Monthly US employment data due Friday will probably determine
the answer. Investors are on the edge of their seats after the release of the July jobs report last month
showed a rise in the unemployment rate. - ECB’s Nagel Sees Euro-Area Inflation on Right Track, FAZ Says
(Bloomberg) — The European Central Bank mustn’t declare victory over inflation too soon, even if the retreat
in consumer-price growth may allow another interest-rate cut next week, according to Governing Council
member Joachim Nagel. - Germany to Sell Down Commerzbank Stake After Share Rally
(Bloomberg) — The German government plans to cut its stake in Commerzbank AG as it seizes on a recent
share rally to initiate an exit from the lender it rescued over a decade ago. The country’s finance agency,
which manages the stake of about 16.5%, announced the move after market close on Tuesday. It didn’t
disclose how much it would sell or when. - Harris to Expand Small Business Tax Relief to Boost Startups
(Bloomberg) — Kamala Harris is proposing a ten-fold increase in the small business tax deduction for startup
costs, a new weapon in her arsenal as she vies with Donald Trump to show voters who can best assuage their
anxieties about the economy. The proposal, outlined by a Harris campaign official on condition of anonymity,
would increase the deduction from $5,000. - Carlyle Said to Pick Banks for $4.7 Billion Acrotec’s Zurich IPO
(Bloomberg) — Carlyle Group Inc. has selected banks for an initial public offering of Acrotec Group, which could be valued at as much as 4 billion Swiss francs ($4.7 billion), according to people familiar with the matter. Bank of America Corp., Morgan Stanley and UBS Group AG are working on the potential Zurich listing of the luxury-watch parts maker, the people said. - Market Chatter: Intel Could Be Dropped From Dow as Shares Plunge
Intel (INTC) could be removed from the Dow Jones Industrial Average as the chipmaker’s almost 60% plunge
in share price this year made it the worst performer on the index, Reuters reported Tuesday, citing analysts
and investors. - Airbus shares fell 1.7% after Cathay Pacific Airways announced it is conducting an inspection of its
entire Airbus SE A350 fleet as a precautionary measure after discovering some engine issues
Cathay Pacific said it identified an engine component failure on A350 aircraft that was forced to return from
its flight to Zurich and a subsequent check of its fleet uncovered a number of the same engine components
that need to be replaced. Additionally, defense names were under pressure as Israelis took part in strikes and
protests to pressure the government to reach a cease-fire with Hamas. - Shares of semiconductor companies fell Tuesday, with Nvidia leading a broad-based selloff in the group
The company reported its quarterly results last week, and while it gave an outlook that was better than
expected, it was narrower than investors have grown to expect over the past five earnings reports. Every
component of the chipmaker index is in negative territory. Earlier, the Semiconductor Industry Association
announced global semiconductor industry sales hit $51.3 billion during the month of July 2024, an increase of
18.7% compared to the July 2023 total of $43.2 billion and 2.7% more than the June 2024 total of $50.0
billion. Wall Street analysts were mixed on the monthly sales data, saying it came in below seasonal trends. - Boeing fell 7.3% on Tuesday as Wells Fargo & Co. lowered the planemaker to a sell-equivalent
recommendation, saying it’s hard to see any upside in the shares
Analyst Matthew Akers cut the price target to $119, the lowest among analysts tracked by Bloomberg.
In a note released Tuesday, Akers said he expects free cash flow per share, Boeing’s main valuation metric, to
peak by 2027 as aircraft development costs offset further production growth. Akers also said further dilution
of the stock through an offering of additional shares is likely. - United States Steel shares dropped 6.1% after Vice President Kamala Harris joined President Joe Biden in declaring the company should remain domestically owned and operated
US Steel is an historic American company, and it is vital for our nation to maintain strong American steel
companies, Harris said during a Labor Day event with unions in Pittsburgh, home to both US Steel and the
United Steelworkers union, which has opposed the sale. Harris’s statement is her first on the proposed deal,
and aligns with Biden, who has also pledged that US Steel will remain domestically owned, though he’s
stopped short of outright blocking it amid a security review. Republican nominee and former President
Donald Trump has called for the transaction to be blocked. Nippon Steel announced last week an additional
$1.3 billion in investments in US Steel’s unionized mills to try and win over the United Steelworkers union. - Shares of Freeport-McMoRan and other copper miners fell after Goldman Sachs ended its longstanding
recommendation to buy copper and slashed its price forecast for the metal
Goldman now expects copper to hit an average price of $10,100 per ton by year-end, below its previous
expectation of $15,000. Due to the higher copper inventories in China and its weak property sector, the price
rally will likely be delayed, the bank said. Copper surged to record levels in May on the back of higher
demand, including from utilities that are upgrading their grids, electric vehicles, and usage in data centers
that help run the artificial intelligence apps. Supply on the other end was tight. Earlier this year, Goldman
described copper as the tightest among many commodities. But copper prices have since come down some
19% as production remained elevated while demand from China, the world’s biggest consumer of copper,
weakened. - Zscaler shares slumped 15.1% in afterhours trading, despite reporting fourth-quarter results that beat
expectations, as it gave a full-year forecast that was weaker than expected on both adjusted earnings and
revenue
FOURTH QUARTER RESULTS: Adjusted EPS 88c vs. 64c y/y, estimate 70c. Revenue $592.9 million, +30% y/y,
estimate $568.5 million. Deferred revenue $1.89 billion, +32% y/y, estimate $1.9 billion. Calculated billings
$910.8 million, +27% y/y, estimate $892.7 million. 2025 YEAR FORECAST: Sees adjusted EPS $2.81 to $2.87,
estimate $3.36. Sees revenue $2.6 billion to $2.62 billion, estimate $2.63 billion. Sees calculated billings $3.11
billion to $3.14 billion, estimate $3.12 billion. RBC Capital Markets, outperform, PT $230: Zscaler delivered a
good finish to the fiscal year with a beat across the board, though the outlook was mixed with midpoint
FY/25 revenue growth of 20% in line with our expectations, and the buyside, but below consensus that was a
bit high. - Apple Inc.
Apple Inc. shares fell 2.72%. The company’s upcoming iPhone 16 release had sent its stock price soaring
because of promised artificial-intelligence features. Those gains appeared vulnerable, at least in the short
term. The company’s stock typically underperformed after iPhone launches, a cautious precedent when
expectations were sky-high and Apple’s share price relative to earnings was quite rich, leaving little room for
error.
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