U.S. index futures indicate a positive opening on Monday, driven by the anticipation of an end to the Federal Reserve’s interest rate hike cycle.
As of 06:28, Dow Jones futures (DOWI:DJI) rose 19 points, or 0.06%. S&P 500 futures gained 0.17%, and Nasdaq-100 futures increased by 0.20%. The yield on 10-year Treasury notes stood at 4.595%.
In the commodities market, West Texas Intermediate crude for December rose 1.66%, to $81.86 a barrel. Brent crude for December gained 1.53% to near $86.19 a barrel. Iron ore with a 62% concentration, traded on the Dalian Commodity Exchange, increased by 0.05%, priced at $127.15 per tonne.
The economic agenda for this Monday will not be busy, with the only highlight being a speech by Cleveland Fed President Loretta Mester scheduled for 11:00 AM.
In the Middle East, the Israeli military struck 450 Hamas targets in Gaza and seized a militant complex. Concurrently, U.S. Secretary of State Antony Blinken visited the West Bank for diplomatic meetings. In Asia, financial markets closed higher, responding to U.S. economic data and comments from the Bank of Japan’s president regarding deflation. The Hong Kong, Shanghai, and Tokyo stock indices recorded significant gains. In Europe, German industrial data exceeded expectations, while other economic indicators for the region pointed to a slowdown.
US stocks closed higher on Friday, driven by optimism following the announcement of lower-than-expected debt issuance by the US Treasury and the Federal Reserve’s decision to maintain stable interest rates. The Dow Jones increased by 0.66%, the S&P 500 rose by 0.94%, and the Nasdaq advanced by 1.38%. Over the course of the week, the Nasdaq saw a remarkable surge of 6.6%, the S&P 500 soared by 5.9%, and the Dow Jones recorded a 5.1% increase. The Treasury has plans to offer $112 billion in bonds, leading to a decline in long-term interest rates. Federal Reserve President Jerome Powell expressed caution and uncertainty about the appropriate adjustments to monetary policy to manage inflation, which will be a crucial factor for the December meeting.
On the corporate earnings front for Monday, investors will be closely monitoring reports from Dish Network (NASDAQ:DISH), BioNTech (NASDAQ:BNTX), Axsome Therapeutics (NASDAQ:AXSM), Kosmos Energy (NYSE:KOS), prior to the market opening. After the market closes, reports from Realty Income (NYSE:O), NXP Semiconductors (NASDAQ:NXPI), Diamondback Energy (NASDAQ:FANG), Coterra (NYSE:CTRA), Tripadvisor (NASDAQ:TRIP), among others, are eagerly anticipated.
Wall Street Corporate Highlights for Today
Amazon (NASDAQ:AMZN), Meta Platforms (NASDAQ:META) – The UK competition regulator has accepted commitments from Meta and Amazon to promote fair competition on their retail platforms. Amazon will not use rival sellers’ market data for unfair advantages, while Meta will refrain from exploiting advertising customer data to enhance Facebook Marketplace.
Apple (NASDAQ:AAPL) – Apple has warned that its revenue in the next quarter will remain virtually flat compared to the previous year, disappointing investors who were expecting growth. Overall sales will remain similar, with the iPhone slightly boosting revenue, while iPad and wearables will experience declines. The company faces challenges in China due to US tech bans and local competition.
Alphabet (NASDAQ:GOOGL) – Epic Games Inc. is challenging Alphabet in an antitrust trial, alleging that the Google Play Store restricts competition by forcing developers to install their apps only through the Play Store. Epic is not seeking financial compensation but rather changes in Google’s practices. The trial is expected to last several weeks, with a witness list that includes executives from both companies.
Berkshire Hathaway (NYSE:BRK.B) – Berkshire Hathaway reported a 40.6% jump in third-quarter operating profits, totaling $10.761 billion, while amassing a record $157.2 billion in cash. Warren Buffett invested in Treasury bonds and reduced stock buybacks.
General Motors (NYSE:GM) – The provisional agreement between the United Auto Workers and General Motors includes salary increases of up to 33% for full-time workers, faster progression opportunities for temporaries, $4 billion in investments in electric vehicle factories, and improvements in working conditions. Additionally, General Motors reversed its decision to lay off 1,245 workers in Brazil after the Labor Court rejected the company’s request. The union considers this reversal a “historic victory.”
Tesla (NASDAQ:TSLA) – Tesla plans to produce a $26,838 car at its Berlin factory, aiming for mass acceptance of electric vehicles. The production start date has not been disclosed. Elon Musk aims to make electric vehicles more affordable. Tesla also announced wage increases for its employees in Gruenheide, Germany.
Lucid Group (NASDAQ:LCID) – Lucid Group has cut prices on its luxury sedan lineup, the Air model, due to fierce competition and a slowdown in electric vehicle demand. High interest rates have pressured EV demand, leading manufacturers, including Tesla, to reduce prices. Lucid has reduced prices on several models, with discounts of up to $10,000. The offer is valid until November 30.
Polestar (NASDAQ:PSNYW) – Electric vehicle manufacturer Polestar announced a deal with South Korean company SK On to supply battery cell modules for its upcoming Polestar 5 EV model.
Ryanair (NASDAQ:RYAAY) – Ryanair expects to achieve a record annual profit of €1.85 to €2.05 billion due to higher summer fares and limited capacity. The company plans to pay regular dividends for the first time and anticipates strong growth next year.
Morgan Stanley (NYSE:MS) – According to Michael Wilson, a strategist at Morgan Stanley, the recent recovery in the S&P 500 should not be seen as the start of a sustained recovery but rather as a bear market rally. Concerns about higher interest rates and weak economic data still persist. Wilson maintains a bearish view on stocks this year.
UBS (NYSE:UBS) – Bosco Ojeda, former head of small and mid-cap European stock research at UBS Group AG, is transitioning to fund management. He has teamed up with Pedro Yagüez to manage the Columbus European Equities mutual fund in Madrid, focusing on small and mid-cap companies.
Barclays (NYSE:BCS) – Barclays has revised its forecast for the Federal Reserve, anticipating a 25 basis point rate hike in January instead of December. This is based on weak job data and the Fed’s cautious approach to future projections. The unemployment rate in October rose to 3.9%, the highest since January 2022. Barclays economists believe the Fed will keep rates elevated until September 2024.
KKR and Company (NYSE:KKR), Telecom Italia (BIT:TIT) – KKR has successfully raised its second global impact fund, garnering $2.8 billion, more than double its 2020 fund. This fund invests in sustainable initiatives aligned with the UN Sustainable Development Goals and has already made 18 investments. In other news, Telecom Italia (TIM) approved the sale of its fixed-line network to KKR for $20 billion. The decision was contested by Vivendi, TIM’s largest shareholder.
BlackRock (NYSE:BLK) – According to Jean Boivin, head of the BlackRock Investment Institute, stocks may face continued pressure due to prospects of higher interest rates and stagnant economic growth. However, other analysts like Savita Subramanian of Bank of America (NYSE:BAC) see upside potential, predicting a 15.5% price return for the S&P 500 over the next 12 months.
Bain Capital (NYSE:BCSF) – Bain Capital is nearing the acquisition of Guidehouse, valued at $5.3 billion, according to the Wall Street Journal. An announcement may be made soon. Guidehouse is a government and business consulting firm that was acquired by Veritas Capital from PricewaterhouseCoopers’ public sector business in 2018.
Cinemark Holdings (NYSE:CNK) – Cinemark reported a net profit of $90.2 million, an increase compared to the $24.5 million loss from the same period last year. Revenue totaled $874.8 million, surpassing estimates, driven by increased admissions and concessions revenue, reflecting a 27.9% rise in admissions and a 6.9% increase in the average ticket price.
Birkenstock Holding (NYSE:BIRK) – Shares of Birkenstock Holding rose 1.2% in pre-market trading, reaching $41.64, after analysts from institutions such as JP Morgan, Jefferies, Citi, and Stifel initiated coverage of the German footwear manufacturer with buy recommendations.
Tyson Foods (NYSE:TSN) – Tyson Foods is conducting a voluntary recall of 30,000 pounds of chicken “Fun Nuggets” after reports of metal pieces in the product. Tyson-branded 29-ounce packages are affected. The product was produced on September 5, 2023. A mild oral injury has been reported, but no further injuries or illnesses associated with it.
Unilever (NYSE:UL) – Lindsell Train, one of Unilever’s major investors, has praised the recent management changes at the consumer goods company and discussed future steps with the new CEO, Hein Schumacher. Unilever plans to simplify its business, focusing on 30 core brands.
Lumen Technologies (NYSE:LUMN) – Lumen Technologies CEO Kate Johnson purchased 1 million company shares at an average price of $0.97 per share, totaling $970,000 in spending. Her acquisition came after a historic drop in Lumen’s stock, which fell 32.9% to $0.98. Johnson now owns over 5.1 million Lumen shares. The company has faced challenges and is seeking a turnaround under her leadership.