1. Asia Mixed as China Whipsaws Before New Year Break: Markets Wrap

    (Bloomberg) — Asian stocks were mixed Thursday as Chinese mainland equities rose in the final trading day before the Lunar New Year holidays. The S&P 500, meanwhile, closed at a fresh high. Chinese benchmarks climbed after the nation replaced the head of its securities regulator Wednesday, a surprise move that may foreshadow more forceful steps to support the stock market.

  2. Oil Holds Three-Day Gain with Equities and Middle East in Focus

    (Bloomberg) — Oil steadied after a three-day advance, with prices supported by gains in wider financial markets and lingering risks in the Middle East. Brent crude traded above $79 a barrel after climbing 2.4% over the prior three sessions, while West Texas Intermediate was near $74. A rally in global stocks is helping to support appetite for risk assets, including crude, even as the Federal Reserve plays down the chance of imminent interest-rate cuts.

  3. Immigration to Boost US GDP by $7 Trillion Over Decade, CBO Says

    (Bloomberg) — The surge in immigration will help bolster the US economy by about $7 trillion over the next decade by swelling the labor force and increasing demand, the Congressional Budget Office said on Wednesday. The stronger growth will be good for the federal government, lifting revenues by about $1 trillion more than otherwise over the period, according to the non-partisan agency.

  4. Blinken Sees Room for Israel-Hamas Deal as Netanyahu Balks

    (Bloomberg) — Israel and the US offered conflicting interpretations of Hamas’s response to a proposal to pause fighting and release dozens of hostages, with Prime Minister Benjamin Netanyahu seeming to reject it out of hand and Secretary of State Antony Blinken saying it opened space for a deal. “While there are some clear nonstarters in Hamas’s response, we do think it creates space for agreement to be reached and we will work at that relentlessly until we get there,” Blinken told reporters at a briefing Wednesday night in Tel Aviv.

    5.The S&P 500 rose Wednesday and edged closer to the 5,000 level, notching a closing high as investors parsed through another slate of quarterly results that signalled a flourishing economy.

    The broad-based index, which first breached the 4,000 level in April 2021, added 0.82% to finish at 4,995.06. At session highs, the S&P hit 4,999.89. The Nasdaq Composite jumped 0.95% to settle at 15,756.64, while the Dow Jones Industrial Average rallied 156 points, or 0.4%, to close at 38,677.36 and an all-time high.

    6. Fed Officials Add to Chorus Tempering Hopes for Rate Cuts Soon

    (Bloomberg) — Four Fed officials suggested Wednesday they don’t see an urgent case for lowering interest rates, adding to a roster of policymakers in recent days who made clear a cut isn’t likely until May at the earliest. Governor Adriana Kugler, Boston Fed President Susan Collins, Minneapolis Fed chief Neel Kashkari and Richmond’s Thomas Barkin were all noncommittal on when the US central bank can start reducing the Fed’s benchmark lending rate from a two-decade high, despite a marked improvement in inflation last year.

    7. Senate Vote Ends Border Deal Prospects, Setting Election Fight

    (Bloomberg) — The Senate delivered a death blow to efforts to impose new border restrictions, blocking a carefully negotiated bipartisan compromise after former president Donald Trump and House Republican leaders denounced the deal. The 49 to 50 Senate vote Wednesday virtually guarantees Congress won’t pass any broad immigration or border legislation before the November presidential election, and perhaps much longer than that. Under the chamber’s rules, 60 votes are needed to break a blockade against legislation.

    8. Trillions of Yen Pile Up at Negative Rates in Bets on BOJ Shift

    (Bloomberg) — Japan’s biggest commercial banks are letting money accumulate in negative interest-rate accounts at the central bank — another sign that the world’s last sub-zero rate policy is coming close to the end. When the Bank of Japan started charging -0.1% interest on certain accounts where lenders parked excess funds eight years ago, policymakers got the result they wanted: cash flowed elsewhere, to more productive parts of the financial system, supporting the BOJ’s campaign to revive the economy and spur inflation.

    9. Walt Disney shares are up 6.5% in afterhours trading, after the media company reported adjusted first-quarter earnings that beat expectations and gave a full-year profit forecast that is seen as strong. The company also boosted its cash dividend 50% and said it targets $3 billion of repurchases in fiscal 2024.

    FIRST QUARTER RESULTS: Disney+ subscribers 149.6 million, estimate 151.2 million. Adjusted EPS $1.22 vs. 99c y/y, estimate 99c. Revenue $23.55 billion, +0.2% y/y, estimate $23.8 billion. Entertainment revenue $9.98 billion, -6.5% y/y, estimate $10.52 billion. Sports revenue $4.84 billion, +4.2% y/y, estimate $4.62 billion. Experiences revenue $9.13 billion, +6.9% y/y, estimate $9.04 billion. YEAR FORECAST: Sees adjusted EPS about $4.60, estimate $4.27.

    10. Arm Holdings Plc climbed 21.4% in afterhours trading after the chip designer gave a surprisingly bullish forecast, showing that its push beyond smartphones is helping fuel growth and profitability.

    Revenue in the three months ending in March will be $850 million to $900 million, Arm said. That compares with an average analyst estimate of $778 million. Earnings will be roughly 30 cents, excluding some items, well ahead of the 21-cent projection. The upbeat outlook reflects an expansion by Chief Executive Officer Rene Haas into fresh areas, including server chips. Executives said that the smartphone industry now accounts for about a third of the company’s sales, underlining how successful he’s been at spreading its bets. And phones now contain more Arm technology per device, helping lift royalty payments.

    11. Emerson Electric climbed 10.4% with analysts encouraged by the company’s strong start to the fiscal year and the boost to its outlook. The maker of industrial equipment and software was among the top performers in the S&P 500 Index on Wednesday.

    FIRST QUARTER RESULTS: Adjusted EPS $1.22, estimate $1.04. Underlying revenue Y/y % +10%, estimate +7.15%. Net sales $4.12 billion, estimate $3.91 billion. YEAR FORECAST: Sees adjusted EPS $5.30 to $5.45, saw $5.15 to $5.35, estimate $5.26. Sees underlying sales +4.5% to +6.5%, estimate +5.17%. Still sees operating cash flow $3.0 billion to $3.1 billion. Citi, Andrew Kaplowitz: “Strong upside to F1Q24 results, mostly inline F2Q24 guidance, and a subsequent FY24 guidance raise are indicative of EMR’s continued good operational execution and still healthy underlying growth trends”. Rates buy with PT $109.

    12. Enphase Energy soared 16.9% as investors looked past lower-than-expected fourth-quarter revenue and a disappointing revenue forecast for the first quarter toward a brighter outlook. The US solar equipment company signalled a recovery post first-quarter 2024 in Europe and the US, excluding California.

    FOURTH-QUARTER RESULTS: Revenue $302.6 million, estimate $327.7 million. Adjusted EPS 54c, estimate 53c. Gross profit $146.7 million, estimate $153.4 million. Adjusted gross margin 50.3%, estimate 47.4%. Adjusted net income $73.5 million, estimate $66.9 million. Microinverter Units Shipped 1.60 million, estimate 2.17 million. Total batteries shipped 80.7 MWh, estimate 87.2. FIRST-QUARTER FORECAST: Sees revenue $260.0 million to $300.0 million, estimate $318.4 million. Sees adjusted gross margin 44% to 47%, estimate 47.4%.

    13. Disney to invest $1.5 billion in Fortnite maker Epic Games

    Walt Disney Co. is acquiring a $1.5 billion equity stake in Fortnite maker Epic Games Inc. as part of a collaboration involving Disney properties like Star Wars, Marvel and Avatar, the companies said Wednesday.

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