This morning key data was released. CPI rose 3.2% y/y in July, versus an expected 3.3%. Core inflation (ex-food and energy) rose 0.2% for the 2nd mo. The data suggests that inflation is high but not rising meaningfully. More than 90% of the increase for overall CPI was due to housing costs, and car insurance also was a key driver. Both used car and airfares declined, and groceries increased. Jobless claims increased to 248k.
The 10yr UST auction executed at a yield of just under 4%, so supply is being absorbed, per Bloomberg. Investors are scooping up the 20-yr, with yields > the 30 yr, per Bloomberg.
Disney mgmt. announced that spending on movies/shows is coming in lower than expected, per the FT. At the same time, mgmt. raised its streaming prices, in some cases by much as 27%, per Bloomberg.
Tapestry (owner of brands like Kate Spade and Coach) is looking to acquire Capri (which owns Michael Kors and other brands) at a $8.5bn price tab.
Alibaba posted a solid revenue beat, given stronger e-commerce. Quarterly profit at Jack Ma’s Ant Group increased by over 17% for the quarter. China’s securities regulator is holding a meeting about the real estate market tomorrow, and Country Garden is not invited. The company expects a 1H23 net loss of up to 55bn yuan. Also, news out of the FT says that Chinese tech firms are increasing Nvidia chip purchases for GenAI because they’re worried the US gov will further limit exports.
Novo Nordisk, the healthcare co that owns Wegovy (the obesity drug), is continuing to restrict supply of its drug in the US because they can’t keep up with demand. Its market value (~$420bn) is more than its home country’s GDP. The recent data, per Reuters, indicating heart benefits from these drugs could increase the likelihood of insurance coverage here in the US for the expensive medicine.
BBG is projecting that $MSFT may get a $5bn topline increase from AI-based copilots in the year they become available. They are projecting roughly $3bn from Office, and a decent size from GitHub.
From the fires and resulting deaths in Hawaii, to the assassination of a leading presidential candidate in Ecuador, there is some sad news out there today.