Mese: Ottobre 2023

© Reuters. A trader works on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., October 27, 2023. REUTERS/Brendan McDermid

By David Randall

NEW YORK (Reuters) -Financial markets are bracing for what could be a momentous week, with a Federal Reserve meeting, U.S. employment data and earnings from technology heavyweight Apple Inc (NASDAQ:AAPL) possibly setting the course for stocks and bonds the rest of the year.

October has lived up to its reputation for volatility, as a surge in Treasury yields and geopolitical uncertainty pressured stocks. The S&P 500 index is down 3.5% for the month, adding to losses that have left it over 10% off its late-July high.

Whether the ride remains rough for the rest of 2023 may depend in large part on the bond market. The Fed’s ‘higher for longer’ stance on interest rates and rising U.S. fiscal worries pushed the benchmark 10-year Treasury yield – which moves inversely to prices – to 5% earlier this month, the highest since 2007. Higher Treasury yields are seen as a headwind to stocks, in part because they compete with equities for buyers.

Investors worry that yields could rise further if the Fed reinforces its hawkish message at the central bank’s Nov. 1 monetary policy meeting. Strong U.S. employment data next Friday could also be a catalyst for yields to rise if it bolsters the case for keeping rates elevated to cool the economy and prevent inflation from rebounding.

“Stocks will start to recover when the market believes that bond yields have peaked,” said Sam Stovall, chief investment strategist at CFRA Research.

Overall, futures markets are pricing in a near-certainty that the Fed does not raise rates in November, and a nearly 80% chance that the central bank holds rates steady in December, according to CME’s FedWatch Tool. Still, policymakers have projected they will keep the key policy rate at current levels through most of 2024, longer than markets had previously anticipated.

Investors are playing a “waiting game of how much does each economic data point need to increase to put another rate hike back on the table,” said Alex McGrath, chief investment officer for NorthEnd Private Wealth.

With U.S. Gross Domestic Product growth at a sizzling 4.9% in the third quarter, signs that the labor market remains too hot, or the Fed sees the need for further tightening to control inflation, could fuel further volatility.

“It feels like we are at a crossroads whether or not the strong growth we’ve seen over the summer months will continue over the fourth quarter,” and keep worries over inflation and restrictive monetary policy bubbling, said Charlie Ripley, senior investment strategist for Allianz (ETR:ALVG) Investment Management.

Adding to the bond market’s concerns, the Treasury is expected to announce its upcoming auction sizes later this week. Worries about a growing federal deficit and increased supply have helped push yields higher.

Investors are also awaiting Apple’s results on Thursday, during an earnings season with disappointments from some growth and technology giants, including Tesla (NASDAQ:TSLA) and Google (NASDAQ:GOOGL). The tech-heavy Nasdaq 100 index is down 11% from its high, though still up nearly 30% on the year.

Some investors believe the worst of the selling may be over.

A stock market rebound would follow seasonal trends, said Stovall, of CFRA Research. Since 1945, the S&P 500 has advanced by an average of 1.5% in November, making it the year’s third-best performing month, he said.

More broadly, some believe the stock market’s trading patterns this year point to a rebound in the fourth quarter.

In the 14 instances when the S&P 500 has gained at least 10% through July and then declined in August, as it did this year, the index has increased every time over the last four months of the year, according to Ned Davis Research. The average gain in those instances has been 10%.

Stocks appear “oversold” according to technical indicators and could rally if economic data comes in as expected, said Randy Frederick, managing director of trading and derivatives for the Schwab Center for Financial Research.

“The stock market is poised for a late Q4 rally.”

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© Reuters. File photo: Cast member Matthew Perry poses at the premiere for the television series “The Kennedys After Camelot” at The Paley Center for Media in Beverly Hills, California U.S., March 15, 2017. REUTERS/Mario Anzuoni/File photo
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By Steve Gorman and Ismail Shakil

LOS ANGELES (Reuters) -Actor Matthew Perry, beloved star of the top-rated 1990s U.S. television sitcom “Friends” as the wise-cracking Chandler Bing, died on Saturday after apparently drowning in a hot tub. He was 54.

The Los Angeles Times and TMZ.com, citing law enforcement sources, reported that the American-Canadian performer was found dead in a jacuzzi at his Los Angeles home. NBC, which broadcast “Friends” for 10 years, confirmed his demise in a statement on social media platform X.

The news brought an outpouring of grief from fellow celebrities and other high-profile personalities.

Actor Mira Sorvino said on X: “Oh no!!! Matthew Perry!! You sweet, troubled soul!! May you find and happiness in Heaven, making everyone laugh with your singular wit!!!”

Canadian Prime Minister Justin Trudeau, who was a former schoolmate of Perry’s in Ottawa, described the latter’s passing as “shocking and saddening”.

“I’ll never forget the schoolyard games we used to play, and I know people around the world are never going to forget the joy he brought them,” Trudeau said on X. “Thanks for all the laughs, Matthew. You were loved – and you will be missed.”

NBC News, citing an unnamed representative of Perry and a law enforcement source, said he was found dead at his home in the Pacific Palisades neighborhood of Los Angeles.

“We are incredibly saddened by the too-soon passing of Matthew Perry,” NBC Entertainment said. “He brought so much joy to hundreds of millions of people around the world with his pitch perfect comedic timing and wry wit. His legacy will live on through countless generations.”

Perry’s last post on Instagram, on Oct. 23, included a photograph of him sitting by a pool or jacuzzi at night, with the words: “Oh, so warm water swirling around makes you feel good? I’m Mattman.”

Perry was best known for his longtime role as Chandler in the internationally successful “Friends,” which ran for 10 seasons from 1994 to 2004, co-starring Jennifer Aniston, Courteney Cox, David Schwimmer, Matt LeBlanc and Lisa Kudrow.

The series made international celebrities out of all six castmates, who played a close-knit group of young adults who spent time at each other’s apartments and at “Central Perk,” a fictional Manhattan cafe.

One of the major story lines involved a clandestine romance between Chandler and Monica Geller, the character played by Cox, which the four other friends – Rachel, Joey, Phoebe and Ross – each discovered one by one. The pair eventually marry.

The group reunited in 2021, 17 years after the series finale, for a much-hyped special that aired on HBO Max.

The show was, for a time, the most watched U.S. television program in prime time, with each actor earning $1 million per episode at the height of its popularity.

Hidden from the public’s view during much of the original run was Perry’s prolonged struggle with addiction to prescription drugs and alcohol, which he detailed in his 2022 memoir, “Friends, Lovers and the Big Terrible Thing.”

“Hi, my name is Matthew, although you may know me by another name. My friends call me Matty. And I should be dead,” Perry wrote in the opening of the book.

In a New York Times interview published in October 2022, Perry said he had been clean for 18 months: “I’ve probably spent $9 million or something trying to get sober.”

Perry recounted in his book that he had to be driven back to rehab right after shooting the episode of Chandler and Monica’s wedding.

Following “Friends,” Perry went on to star in three more network television ventures that proved short-lived – “Studio 60 on the Sunset Strip,” “Mr. Sunshine” and “Go On.”

He also logged guest appearances or recurring roles in other hit TV shows, including “The West Wing,” “Ally McBeal,” “Scrubs” and “Beverly Hills, 90210.” His motion picture credits included “Fools Rush In,” “The Whole Nine Yards,” “Almost Heroes” and “Three to Tango.”

The Massachusetts-born actor grew up in Ottawa after his mother, a Canadian journalist who once served as press secretary to former Prime Minister Pierre Trudeau, divorced Perry’s father and married a Canadian broadcasting personality.

Perry was a top-ranking junior tennis player before he moved to Los Angeles to pursue acting and improvisational comedy.

© Reuters.

Investing.com — Here is your weekly Pro Recap of the past week’s biggest headlines in the electric vehicle space: EV makers are hitting pause on EV production; BP makes a deal; and Tesla escapes EU probe.

As always, InvestingPro users got these headlines at lightning speed. Never miss another opportunity to secure an edge for your portfolio.

EV makers take cautious approach to slowing demand

The recent cautious approach adopted by major automotive players has signaled a significant shift in the electric vehicle (EV) market.

Tesla (NASDAQ:TSLA) announced Wednesday that it will slow its production ramp, echoing the cautious approach of General Motors (NYSE:GM), which revealed Tuesday a decision to delay the production of its electric pickup trucks, reflecting a broader industry trend.

GM’s CEO, Mary Barra, emphasized the need to “moderate” the acceleration of EV production in North America, citing a recent slowdown in consumer demand for EVs.

This reticence is not confined to GM and Tesla. Ford (NYSE:F), in a similar move, scaled back its electric vehicle ramp-up, temporarily reducing shifts at a key manufacturing plant. The decision comes as the company has decided to redirect its investments toward the production of commercial vehicles and hybrids.

Meanwhile, the challenges faced by Hertz (NASDAQ:HTZ) and Porsche (ETR:P911_p) (OTC:POAHY) underscore the broader complexities of the EV sector. Hertz, with an estimated 50,000 EVs in its fleet, has chosen to decelerate the electrification process as Tesla’s recent price cuts have significantly impacted the resale value of electric cars in the rental fleet, prompting a cautious reassessment of the company’s electrification goals.

Similarly, Porsche’s decision to postpone the production of the Macan electric SUV until next year echoes the challenges faced by the industry at large. Contributing to Porsche’s setback have been delays in Volkswagen’s (ETR:VOWG) (OTC:VWAGY) development of crucial automative software through its CARIAD division.

BP Pulse steps up with $100M deal

Oil-and-gas conglomerate BP (LON:BP) (NYSE:BP) on Thursday announced a $100 million deal in which its EV charging arm, BP Pulse, agreed to deploy Tesla ultra-fast charging hardware units at strategic locations within the BP family of brands starting in 2024.

Those brands include TravelCenters of America (NASDAQ:TA), Thorntons, ampm, and Amoco, as well as at its Gigahub charging sites and third-party locations like Hertz – and initial installation sites have already been earmarked in Houston, Phoenix, Los Angeles, Chicago, and Washington, DC.

These Tesla chargers will bear the BP Pulse branding, and BP will oversee their installation and operation. Equipped with Tesla’s “Magic Dock,” the chargers will support both North American Charging Standard (NACS) and Combined Charging System (CCS) connectors.

BP Pulse has already installed more than 27,000 charge points as part of the company’s commitment to invest up to $1 billion in EV charging across the US by 2030.

Tesla escapes EU probe

Tesla was able to breathe a sigh of relief on Friday as reports indicated that the European Union’s investigation into Chinese government subsidies would not include the EV giant. However, Tesla may still face potential duties linked to its own identified subsidies.

Despite Tesla’s prominent shipment of electric vehicles from China to Europe, the EU’s investigation is concentrated on three specific Chinese manufacturers: BYD, SAIC Motor, and Geely.

SAIC Motor operates as a state-owned entity, while Geely and BYD, established in 1986 and 1995, respectively, are privately held companies (Geely’s subsidiary, Geely Automobile Holdings (HK:0175) (OTC:GELYF) is publicly traded), as is Byd’s parent (SZ:002594), a manufacturing conglomerate). Nonetheless, it’s likely that all three firms have received more direct subsidies over the last few decades than international brands.

It is worth noting that, should the initial investigation uncover indications of unfair competition due to distorted subsidies among the Chinese manufacturers, Tesla, along with other companies manufacturing vehicles in China for the European market, may find themselves included in a subsequent probe.

Shares of TSLA shot up 5.8% Monday before hitting a weekly high of $221.03/sh on Tuesday. TSLA ended the week up 2.16%.

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© Reuters.

Investing.com — It’s going to be a very busy week for investors, with a Federal Reserve meeting, the latest U.S. jobs report and earnings from technology heavyweight Apple that could set the direction for stocks and bonds the rest of the year. Here’s what you need to know to start your week.

Federal Reserve meeting

Investors will be turning their attention to the Federal Reserve’s policy meeting on Wednesday, eager to hear policymakers’ views on the state of the economy and the outlook for interest rates.

Most investors are betting that the Fed is done tightening after Chair Jerome Powell said that rising long-term yields reduce the need for further rate increases, though some believe another hike could come when the central bank meets again in December.

Any indications that the Fed intends to keep rates around current levels through next year could bolster bets on further upside in Treasury yields, whose climb to their highest levels in more 15 years has contributed to a sharp sell-off in the S&P500.

The index has fallen more than 10% since hitting a year-high in late July, though is still up nearly 8% on the year.

Nonfarm payrolls data

The key piece of economic data this week will be Friday’s nonfarm payrolls report for October. After a blockbuster 336,000 jobs were added in September, economists are expecting more moderate jobs growth of 182,000, which is still consistent with a robust labor market.

The unemployment rate is expected to remain at 3.8%, while wage growth is expected to ease to 4% year-on-year, which would mark a post-pandemic period low. This could help bolster the Fed’s view that price pressures are easing and that it doesn’t need to raise interest rates any further.

Ahead of Friday’s data, market participants will be looking at data on third-quarter employment costs on Tuesday for signs that wage growth is moderating.

Earnings

Apple (NASDAQ:AAPL) tops the bill in what is set to be another busy week of U.S. corporate earnings, with the iPhone maker reporting on Thursday.

Shares of Apple, the largest company by market value, have helped drive equity indexes higher this year along with shares of other megacap U.S. tech and growth companies.

Third quarter earnings season has seen disappointments from some Big Tech names, with shares of Alphabet (NASDAQ:GOOGL) and Tesla (NASDAQ:TSLA) slumping after their respective reports. The tech-heavy Nasdaq 100 index is down 11% from its high, though still up nearly 30% on the year.

Consumers’ spending habits will also be in the spotlight with other companies set to report include McDonald’s (NYSE:MCD) on Monday, Caterpillar (NYSE:CAT) and Pfizer (NYSE:PFE) on Tuesday, Mondelez (NASDAQ:MDLZ) on Wednesday, and Starbucks (NASDAQ:SBUX) and Eli Lilly (NYSE:LLY) on Thursday.

Bank of England

The Bank of England is to hold its penultimate meeting of the year on Thursday, where officials will need to decide whether to resume raising interest rates, having kept them on hold in September after 14 hikes in a row.

Investors are expecting the BoE to keep rates on hold at a 15-year high of 5.25%, while leaving the door open to further hikes if necessary. Policymakers are also expected to reiterate that rates will need to remain around current levels for quite some time to come despite growing signs that the economy is flat-lining.

The BoE will update its quarterly forecasts which in August showed economic growth of just 0.5% in both 2023 and 2024. Governor Andrew Bailey spoke earlier this month of a “very subdued” outlook.

Eurozone inflation and GDP

The European Central Bank kept interest rates on hold on Thursday after the steepest pace of rate hikes on record and will now be looking ahead to Tuesday’s data on inflation and gross domestic product ahead of its final meeting of the year.

Preliminary data on consumer price inflation is expected to show the headline rate slowing to 3.2% in October, coming closer to the ECB’s 2% target, even if high energy costs continue to pose an upside risk.

GDP data the same day is expected to show that the Eurozone economy contracted by 0.1% in the third quarter, for an annual rate of growth of just 0.2%.

On Thursday, ECB President Christine Lagarde hinted at steady policy ahead and pushed back against rate cut expectations.

–Reuters contributed to this report