Market Wraps
Watch For:
S&P CoreLogic Case-Shiller Home Price Index for June; Conference Board Consumer Confidence for August; Earnings from Bank of Montreal, Best Buy, HP, Hewlett Packard Enterprise, PDD
Today’s Top Headlines/Must Reads:
– Chinese Stocks Are in a Slump-and Value Investors Are Excited
– Chevron Workers in Australia Set Date for Work Bans, Stoppages
– Private Equity Borrows Billions to Bring You Broadband Internet
Opening Call:
Stock futures edged lower on Tuesday as investors awaited an important batch of economic data over the rest of the week that may color the outlook for Fed policy.
The central bank in particular will be paying close attention to its preferred inflation measure, the July personal consumption expenditures price index, due on Thursday, followed by the August nonfarm payrolls data on Friday.
Overseas Markets
Talk of more stimulus for China’s economy helped markets in Asia and further underpinned sentiment, according to analysts. Chinese stocks rose, while other Asian and European indexes were mostly higher.
Pre-Market Movers
The board of 3M approved a $6 billion settlement to resolve claims it sold faulty combat earplugs to the U.S. military, The WSJ reported. Shares were rising 0.7% in premarket trading.
AT&T was rising 1.6%, while Verizon Communications gained 1.5%. Shares of both companies were upgraded to Buy from Neutral at Citi.
Best Buy is expected to report fiscal second-quarter adjusted earnings of $1.06 a share on revenue of $9.52 billion. Shares were rising 2.6%.
Catalent shares rose slightly following a Reuters report that said the company was close to reaching a settlement with activist investor Elliott Investment Management that would include adding new board directors and a pledge to review strategic alternatives such as the sale of the company.
Hawaiian Electric stock rose 7%. A unit of Hawaiian Electric denied Monday that its power lines were responsible for the wildfire that destroyed the town of Lahaina.
Heico reported fiscal third-quarter earnings and sales that beat analysts’ estimates but operating margins declined to 20.7% from 22.6% a year earlier. The stock was down 5.3%.
NIO is expected by analysts to report a quarterly loss Tuesday of 33 cents a share on sales of $1.3 billion, according to Bloomberg. Shares rose 1.8%.
VinFast Auto stock fell back about 7%. VinFast, which has a small free float and went public via a blank-check merger, so far hasn’t sold many vehicles and has plenty of skeptics.
Monday’s Post-Close Movers
OP Bancorp. said it launched a new buyback program that targets up to 750,000 shares. Shares rose 1.3%.
TSR’s board said it initiated a process to identify and evaluate potential strategic alternatives to maximize shareholder value. Shares rose 6%.
Forex:
Trading in the dollar steadied following the keenly-awaited Jackson Hole meeting, including a speech by Powell, as it contained no major surprises and calm returned to the market, Natixis Research said.
Energy:
Oil prices were steady in Europe, with investors waiting to see if anything comes from speculation the U.S. is considering easing sanctions against Venezuela and Iran, which could open the door to more crude-oil exports.
Meanwhile, weakness in China’s economy and concerns the Fed could yet still raise interest rates are hanging over oil’s demand prospects.
“The demand outlook in the coming months remains clouded with uncertainty and will in our opinion cap the upside potential,” Saxo said.
Metals:
Base metals prices and gold were rising in early London trading, with ING highlighting that China introduced support measures on Monday for transport, property and other infrastructure projects.
“These measures have helped broader sentiment in financial markets.”
ING added that gold has also gained after the Fed indicated rates would hold steady in September.
“However, we will need to keep a close eye on data releases in the coming weeks, which could shed more light on what the Fed may do.”
Today’s Top Headlines
Private Equity Borrows Billions to Bring You Broadband Internet
Wall Street is churning out billions of dollars in complex bonds to bankroll construction of broadband fiber-optic networks, part of a nationwide push to widen high-speed internet access.
Telecom companies have already sold more than triple the number of so-called fiber bonds they borrowed in all of last year. That has helped pay for expanding high-speed internet into small and midsize cities where residents and businesses previously had only one choice-expensive and spotty service from cable monopolies.
Manufacturers Leaving China Find a Home With Indian Startups
BENGALURU, India- In early 2020, as the pandemic was shutting down global commerce, a Pennsylvania company was having trouble getting its usual steel parts out of China. It stumbled on another possible option-in India.
Zetwerk, a two-year-old startup connecting customers and manufacturers within the country, had never handled a U.S. order, but tapped its network of suppliers and delivered the parts. It is now a provider of everything from nail clippers to steel frames for U.S. customers, and is valued at $2.7 billion, with funding from Greenoaks Capital, Lightspeed India, Peak XV Partners and others.
German Consumer Sentiment to Worsen in September on Fears of Squeezed Incomes
Consumer confidence in Germany weakened in data for September, reversing August’s improvement, reflecting gloomier income expectations and prospects for the country’s economy.
Germany’s forward-looking consumer-sentiment index forecasts confidence to tick down to minus 25.5 in September, from a revised minus 24.6 in August, according to data from market-research group GfK published Tuesday.
Germany Is Losing Its Mojo. Finding It Again Won’t Be Easy.
BERLIN-Two decades ago, Germany revived its moribund economy and became a manufacturing powerhouse of an era of globalization.
Times changed. Germany didn’t keep up. Now Europe’s biggest economy has to reinvent itself again. But its fractured political class is struggling to find answers to a dizzying conjunction of long-term headaches and short-term crises, leading to a growing sense of malaise.
The Race to Succeed President Biden Is Heating Up on the 2024 Campaign Trail
High-profile Democratic governors are stumping for President Biden’s 2024 re-election campaign and simultaneously auditioning to become the party’s next standard-bearer.
Their efforts signal they are unlikely to cede that role in 2028 to Vice President Kamala Harris, whose sluggish approval ratings have raised doubts among some donors and party officials about whether she can effectively succeed Biden.
U.S., Allies Seek Long-Term Military Aid for Ukraine to Show West’s Resolve
The Biden administration and its European allies are laying plans for long-term military assistance to Ukraine to ensure Russia won’t be able to win on the battlefield and persuade the Kremlin that Western support for Kyiv won’t waver.
The effort, building on commitments made at a Group of Seven leaders meeting on the sidelines of the North Atlantic Treaty Organization summit in July in Vilnius, Lithuania, so far involves bilateral negotiations between the U.S. and Ukraine and the U.K. and Ukraine. About 18 non-G-7 countries have signed up to the group’s pledge to provide long-term assistance to Kyiv, including the Netherlands, Sweden and other European countries.
Source: Dow Jones Newswires